Bitcoin has recently plummeted to $60,001, marking its lowest level since October 2024. On-chain data suggests that large investors are cutting back their positions, while smaller investors continue to view the dip as a buying opportunity. This contrasting market behavior has rekindled debates about whether we might be entering a deeper bear market compared to past cycles.
Whales Retreat as Small Wallets Buy
According to data from crypto analytics firm Santiment, wallets holding between 10 and 10,000 BTC, classified as “whales and sharks,” control 68.04% of Bitcoin’s total supply. This marks the lowest level recorded in the past nine months. Similarly, these large wallets have sold about 81,068 BTC in just the last eight days.
Conversely, the share of small wallets holding less than 0.01 BTC has increased to 0.249%, marking the highest level in the past 20 months. Santiment notes this rise indicates small investors see price drops as buying opportunities and remain confident in the market. However, the firm emphasizes that historically, when large investors sell and individual investors buy, it often aligns with bearish market conditions. Santiment suggests whales may continue to sell until broader market capitulation is evident.
Peter Brandt’s $42,000 Warning and Market Comparisons
Experienced trader Peter Brandt warns that if Bitcoin’s decline intensifies, the $42,000 level could become a critical support area. Brandt describes the current phase as a “banana peel” retreat, indicating the price might slide toward the lower band of a long-term rising channel. In previous cycles, this area served as a base, suggesting a similar possibility. TradingView charts also show Bitcoin remains within a long-term rising channel on a monthly timeframe but with an increased risk of testing the lower band.
In parallel developments, net outflows from U.S.-based spot Bitcoin ETFs have been reported in recent weeks. These ETF outflows point to growing caution on the institutional side and suggest that the selling pressure might not only stem from individual but also institutional sources when combined with on-chain data.
Overall, the landscape indicates growing uncertainty in the cryptocurrency market. While whale sales create short-term pressure, small investor purchases may prevent drastic price crashes. However, historical cycles remind us that this balance may disrupt several times before a clear bottom forms. In the upcoming period, both on-chain data and macroeconomic developments will be crucial in determining Bitcoin’s trajectory.
