Bitcoin Profitability Stress Ratio Analysis

Since September 2024, Bitcoin’s profitability stress ratio has reached 0.23, indicating extreme volatility in the cryptocurrency market, according to on-chain analytics firm Glassnode. The stress ratio measures the proportion of supply experiencing losses compared to the overall supply, reflecting holder tensions.

> Bitcoin’s profitability stress ratio measures the relative magnitude of supply in loss, reflecting market stress. As of the latest report, the ratio is 0.23, the highest since September.
> — glassnode (@glassnode) March 17, 2025

When the stress ratio increases, investors are more inclined to sell their Bitcoin holdings due to losses in their investments, which may shift market sentiment.

Historical Trends Suggest Market Pressure

Glassnode reported that historical market turmoil occurs when this metric exceeds 0.2. Rising stress ratios typically indicate increased selling pressure that may lead to considerable market movement.

The market experiences elevated stress levels when the stress ratio surpasses 0.2. A sustained upward trend suggests growing market pressure that could cause long-term changes in sentiment, as noted by Glassnode.

Market Sentiment at a Critical Point

Bitcoin price has seen varied trends over recent months, while market participants continually track key signals. The increase in the supply stress ratio indicates that more Bitcoin holders are facing negative holding prices, potentially leading to panic selling and strategic buying by long-term investors.

The Glassnode graph illustrates the relationship between Bitcoin’s price levels and market supply values based on realized profit and loss margins. The red line, indicating supply in loss, has consistently risen alongside increasing market stress, whereas the blue line tracking supply in profit has recently declined.

What’s Next for Bitcoin?

Market stress conditions create situations for Bitcoin traders to observe whether stress ratios will either rise further or stabilize. An increasing stress ratio may trigger more sell-offs, strengthening bearish trends. Conversely, market strength and potential recovery become evident if the stress ratio stabilizes or declines. Investors must remain vigilant by monitoring blockchain indicators and external economic factors influencing future price actions.