Wikia

"This image was taken from a split second frame in a corrupted bootleg of the Spongebob episode 'Dumped.' Other than the image, the rest of the video is composed of incomprehensible jumbles of colors, static, or just black screens. The audio seems to be a heavily distorted version of the audio from the original episode, with loud, droning buzzes occasionally interrupting it. The bootleg tape itself was found in December 2004 by a group of 5 teenagers from the city rummaging around in a trash can within an abandoned mental institution. Of these 5 individuals, 2 have committed suicide, 1 has gone missing, 1 refuses to comment on the tape, and the last hastily agreed to give paranormal investigators the tape shortly after being interviewed about the suicide and disappearances of the other 3 persons. The current whereabouts of the tape are unknown, and many who stare at this image for a long enough period of time claim to see Spongebob blink..."

This was the text in the 4chan post of the same image. This image is actually a .gif and Spongebob will blink in the original picture.