On-chain data shows that the Bitcoin PnL Index is currently in a transition phase that has historically led to bottoms, but not immediately.
The Bitcoin PnL index has recently declined
In new mail On X, community analyst Maartunn talked about the latest trend in Bitcoin Profit and loss indicatorwhich combines data from a few key on-chain metrics into a single metric to produce a single valuation index for BTC.
Metrics include MVRV, NUPL, and LTH/STH SOPR ratio. The first two deal with investors’ unrealized gains/losses while the latter relates to the gains/losses realized by their owners through their transactions.
Now, here’s the chart shared by Maartunn that shows the trend in the 365-day moving average (MA) of the Bitcoin PnL indicator over the history of the cryptocurrency:
As shown in the chart above, the 365-day moving average of the Bitcoin PnL indicator has been following a consistent downward trend since Q4 2025, reflecting a bearish shift in the market.
So far, the indicator has not left the positive zone, indicating that the cryptocurrency, at least from the perspective of the metric, has not yet become “undervalued.”
In the chart, that date is shown Bear market Lows generally occurred as the PnL index fell into the red zone. Given this, it is possible that a similar trend will emerge in this cycle as well.
However, something to keep in mind is that the current cycle has actually differed from previous cycles in the year Bull market phase. Past sessions have seen one major peak in the P&L index that coincided with the market top. However, this cycle saw the formation of two similar-sized peaks alongside the Q1 and Q4 2025 peaks.
As such, it now remains to be seen what the index’s path will look like by the time this bear market ends and whether it will be like the one we have seen in previous sessions.
In some other news, the recent bearish price action means that Bitcoin Short Term Holders (STH) have fallen into a deep state of loss, as another X analyst explained. mail.
STH whales refer to BTC investors who hold at least 1,000 tokens in their wallet and who have purchased the cryptocurrency within the past 155 days. Below is a chart showing what the net profit/loss held by these mega investors looks like right now.
“Short-term carrier whales now sit at -$16.4 billion in unrealized gains and losses, the deepest level of stress seen this cycle,” Martin noted.
Bitcoin price
At the time of writing, Bitcoin is trading around $61,700, down more than 6% in the past seven days.
