As you look up into the cap, if the spark you see jumping is way up inside the silicone boot, there is a problem with the insulation breaking down which probably was caused by damage, see below. If the spark is jumping around the bottom of the visible silicone insulation, that is normal and just shows that you have a nice strong spark.

On a used engine, if the cap ever came into contact with the ground, such as during a bad landing, the insulation can be damaged. It takes a very minor impact to damage the insulation. If the insulation is damaged, you need to replace the cap and again there are quite a few instructional threads on how to do this. Certainly this could affect how the engine runs. You could also replace the whole ignition box but this probably isn't necessary.