Bitcoin’s (BTC) bearish market signals have resurfaced after the number of BTC held at a loss reached 7.75 million tokens as of May 2025. Despite the price hovering just above $77,000, this level means many investors are still holding their coins in the red.
Losses on spot BTC increase
In recent months, the prolonged sideways movement in BTC’s price has led to a significant share of the total supply being held below its purchase price. On-chain data shows that the number of coins held at a loss has fluctuated between 7.64 and 7.75 million in recent weeks, painting a picture typical of a bear market.
This scenario indicates a substantial stockpile of coins with unrealized losses that are still yet to be sold. Unless BTC sees new positive catalysts or supportive developments, this accumulation of loss could trigger a wave of collective selling by investors, known as a capitulation event.
The number of BTC held below cost has returned to levels familiar from previous bear markets, with 7.75 million coins currently underwater compared to their purchase price.
Mini glossary: Capitulation refers to mass panic selling in the market where investors exit by accepting losses, often following major price drops. This process usually completes quickly and may be followed by a sharp price rebound.
According to data from BGeometrics, roughly 53% of the BTC supply is still held above its cost basis, meaning these holders remain in unrealized profit.
Whale strategies shift
Moving into 2026, the profile of BTC holders is shifting. In particular, large holders—so-called whales—are buying at new price levels, while early whales with cheaper entry points are cashing out profits and leaving the market. There is a notable churning of positions across investor groups, from individual holders to institutional ETFs.
Back in February, the amount of BTC held at a loss peaked at 9.7 million coins, so the current numbers are below that high. However, the pattern for 2026 shows whales are taking new positions while some earlier whales reduce holdings.
Meanwhile, most of the BTC sold off from ETF portfolios came early on, and corporate treasuries have shown little movement in their Bitcoin reserves since.
With Bitcoin trading in a narrow range, whales have used lower prices to accumulate more positions, while selling accelerates when the price breaks above $78,000. This approach allows major investors to profit from volatility and sideways trends in the market.
Investor behavior and selling pressure
Among wallet groups, the past year brought the most notable changes in the so-called “humpback whale” wallets, which are the largest holders. This category has offloaded 8.5% of their BTC, while smaller whales saw a 3.72% decrease. In the past 30 days, wallets holding 10–100 BTC fell by 41, and “shark” wallets mostly maintained their holdings.
Mini glossary: Whale and shark describe investors holding large (whale) or substantial (shark) amounts of Bitcoin. “Shrimp” refers to small holders with less than 1 BTC.
Another notable trend is panic selling by so-called “shrimp” wallets—those holding less than 1 BTC. Over the past month, more than 42,000 small wallets were emptied entirely and exited the market. Despite this, the majority of whale wallets retained their positions, preventing a mass panic sell-off for now.
Since February, whales have continued accumulating BTC despite higher entry prices. As of May 25, the average cost rose to $77,253, with most recent trades accumulating at or above the $72,000 mark.
| Wallet Group | 12-Month Sell-Off Rate | Change in Last 30 Days |
|---|---|---|
| Humpback Whale | 8.5% decrease | – |
| Small Whale | 3.72% decrease | 41 wallets lost (10–100 BTC) |
| Shark | Minimal decrease | Majority held steady |
| Shrimp (<1 BTC) | Mass panic selling | 42,000 wallets wiped out |
Latest data shown on CryptoAppsy platforms indicate BTC is trading just above $77,000, hovering slightly above the average cost basis. Therefore, most holders are not deeply underwater, but if support levels fail, the risk of widespread selling remains.
Risks and key market dynamics
Although BTC’s recent tight price range has pushed volatility down to around 1% over the past month, the risk from leveraged positions and immediate spot market liquidations persists. Wallet activity also suggests that while mass sell-off risk is low, it could quickly escalate.
Retail investors (shrimp wallets) have been the fastest to exit in recent times, whereas whale-class holders have remained largely steady. The surplus of spot BTC supply signals no immediate flood of sales, but any strategic sell-offs by big players could cap short-term price gains.
