Bitcoin Recovery Requires STH Profitability Above 50%: Glassnode

On-chain analytics firm Glassnode has explained how a flip in Bitcoin short-term holder profitability could act as a precondition for a sustained price recovery.

In a new post on X, Glassnode has talked about the latest trend in the Supply in Profit metric for the Bitcoin short-term holders (STHs). The Supply in Profit measures, as its name suggests, the percentage of the BTC supply that’s currently being held at some net unrealized gain.

In the context of the current topic, only the above-water supply held by the BTC STHs is of relevance. This cohort includes all addresses that purchased their tokens within the past 155 days. The STHs make up one of the two main divisions of the market, based on holding time, with the other side being known as the long-term holders (LTHs).

Statistically, the longer an investor holds onto their coins, the less likely they are to sell them in the future. As such, the STHs with their relatively low holding time are considered to represent the weak-minded side of the market, while the LTHs include the diamond hands.

As the chart below for the Supply in Profit of the STHs shows, the new entrants to the market were enjoying a high degree of profitability before Bitcoin experienced a bearish shift in Q4 2025:

The price decline has caused the indicator’s value to plummet, meaning a chunk of the tokens held by the Bitcoin STHs have gone underwater. From the graph, it’s apparent that the indicator dropped below the 50% mark a while ago and has continued to be in this low profitability zone since.

In the past, this cohort being under stress has generally meant a lack of demand in the market. “Demand-side risk appetite tends to remain suppressed until this flips back above 50%,” noted Glassnode.

In the chart, a few examples of the STH Supply in Profit flipping back above 50% are visible, with the latest one being the price rebound from the first half of 2025. Back then, a return of profits for the cohort led to a Bitcoin rally that set new price all-time highs (ATHs).

Given this trend, it’s possible that a flip in the metric above the 50% level could once again be of significance for the cryptocurrency. “Watch this level as a precondition for any sustained recovery,” explained the analytics firm.

Bitcoin has been making a fresh attempt at the $72,000 level following its surge of 3% over the last 24 hours.