Key Takeaways
Why is Bitcoin struggling now?
SOPR data shows investors selling at a loss, while the Sharpe Ratio indicates BTC’s volatility isn’t delivering enough returns.
Which assets are benefiting?
Altcoins are gaining investor capital, with dominance rising to 61, nearing altseason levels.
Bitcoin [BTC] has seen a notable decline in the past day, with capital outflows surging.
The asset experienced a sharp sweep, plunging to the $113,000 region on the chart after failing to break above resistance despite repeated attempts.
The decline isn’t exclusive to Bitcoin, as the broader market also dropped by 3.90% during this period. Notably, data suggests altcoins could recover faster.
Profitability pushes investors away
Bitcoin’s profitability ratio has weighed heavily on its price, pushing investors out.
The Spent Output Profit Ratio (SOPR) trend according to Alphractal has pointed to bearish signals, suggesting profitability is drying up and investors are selling at a loss.
This trend has been influenced by late accumulation of the asset following Bitcoin’s massive rally in recent months.
Source: Alphractal
This level represents the average purchase price of Bitcoin by short-term holders—those who have held the asset for no more than 155 days.
As the price trends downward toward this level, investors may sell off to secure remaining profits.
In fact, crypto analyst Joao Wedson has advised investors buying at current levels to “reconsider their strategy.”
More indicators flag a bearish market
The risk-adjusted return on Bitcoin has also declined in 2025. Data from the Sharpe Ratio—an indicator used to measure risk-adjusted returns—confirms this trend.
The analysis shows that the Sharpe Ratio has dropped below 2024 levels. For context, this suggests that Bitcoin’s volatility is no longer adequately compensated by its price gains.
Declines of this nature tend to shift investor attention toward less volatile or higher-yield altcoins.
Source: Alphractal
Investor interest in Bitcoin has also been gradually falling, as measured by declining social interest. Typically, this correlates with price action, and a drop may indicate waning market enthusiasm.
Wedson described the move as a calculated effort from market makers:
“[Market makers are] partially selling their BTC and taking their stablecoin reserves to invest more in altcoins after a long accumulation period.”
He added that even if Bitcoin hits a new high, profitability will remain limited, and the “real focus” has shifted to altcoins with better risk-to-return potential.
Altcoin interest continues to grow
Altcoin dominance data from CoinMarketCap shows growing investor interest, though not yet at altseason levels.
Altseason refers to a period when altcoin market capitalization surges significantly. On the chart, this is typically signaled when the index reads above 75.
Source: CoinMarketCap
At the time of writing, the index remains at 61—relatively close to altseason territory—suggesting active buying and the potential for further gains in upcoming trading sessions.
