A report by supply chain analytics firm Glassnode highlighted how transitions to robust growth phases have historically required liquidity to remain above a key threshold.

Bitcoin’s rally may require an escalate in the realized profit-to-loss ratio above 5

In the latest weekly reportGlassnode spoke about liquidity conditions occurring on the Bitcoin network as the asset’s price plummeted after failing to regain value earlier this month.

“Any significant shift back to sustainable growth should be objectively reflected in liquidity-sensitive metrics such as the realized profit/loss ratio (90D-SMA),” the analyst firm explained. The Realized Profit/Loss Ratio refers to a metric that, as the name suggests, compares the realized profit and loss that BTC traders realize on their trades.

When the value of this ratio is greater than 1, it means that holders as a whole realize a greater amount of profit than loss. On the other hand, an indicator below the threshold suggests that the network is dominated by losses. Naturally, if the realized profit/loss ratio is exactly equal to 1, it can be assumed that the average holder simply breaks even on selling, and profits and losses are collected on the blockchain exactly canceling each other out.

Here is a chart showing the 90-day moving average (MA) trend of this Bitcoin indicator over the last decade:

As shown in the chart above, MA Bitcoin’s 90-day realized profit/loss ratio peaked in the second half of 2025 as investors exited the market with profits during the bull market. However, since then the rate has seen a keen decline.

At its peak, the metric was near 20, meaning profits outweighed losses by almost 20 times, but has recently fallen to below 2. From an indicator perspective, profit-taking continues to dominate the sector, but profits are currently less than twice as huge as losses.

According to Glassnode, in the past, a move towards robust growth required the indicator to escalate and stay above 5. Currently, the indicator’s trajectory is still pointing downwards, so it is uncertain whether there will be any improvement in the near future and, if it does, whether it will exceed this threshold again.

That said, only twice this cycle has Bitcoin’s liquidity fallen below this level and managed to return above it. Although in both of these cases it bottomed at levels noticeably above its current value.

BTC price

At the time of writing, Bitcoin is trading at around $87,800, down 2.4% over the past seven days.