Recent on-chain data reveals a striking shift in the Bitcoin market. According to the latest Binance Research analysis, four key indicators suggest a tightening in available supply, most notably as long-term investors remain committed and the amount of BTC held on exchanges drops sharply.
Selling pressure in crypto markets declines
A standout highlight is the exchange-held Bitcoin balance, which has fallen to its lowest point in six years. Nearly 60% of all BTC supply has remained untouched for more than a year. Blockchain data indicates this trend accelerated after the approval of spot Bitcoin ETFs in the US at the start of 2024, with inactive supply peaking at 69.5% during that period.
Back in 2012, the proportion of unmoved Bitcoin stood at just 27%, but it has steadily increased over the years. Despite the spot ETF greenlight, no significant movement was observed among coins held by long-term investors—even as short-term selling pressure briefly intensified. Binance Research highlights this stable pattern as a testament to the strength and conviction of long-term holders.
“The proportion of inactive BTC supply reached 69.5% in January 2024. This period, marked by the approval of spot Bitcoin ETFs, proved that long-term holders did not rush to sell their assets or exit the market,” the analysis notes.
At the same time, Bitcoin balances on exchanges have notably dropped. Once as high as 17.6% following the pandemic, that figure now sits at around 15%. This implies roughly 500,000 bitcoins have been permanently withdrawn from exchanges, shrinking the pool of liquid, sellable BTC and reducing the risk of sudden sell-offs.
On-chain indicators point to cyclical change
Technical metrics further confirm a significant turning point for the Bitcoin market. The SLRV ratio has fallen to historic lows, reflecting a marked decrease in short-term speculative trading and lower transaction volumes across the network.
Similarly, the STH MVRV metric—tracking the cost-to-value ratio for short-term holders—has stayed below 1.0 for most of the period since November 2024. This typically signals that short-term investors have been operating at a loss, fueling earlier selling pressure. However, a recent uptick in this metric shows these investors are once again finding profitability in their positions.
“Market cycle lows often appear when the SLRV ratio bottoms out and short-term holders retreat from selling. With the STH MVRV back above 1.0, short-term investors are beginning to exit their loss-making trades,” according to market specialists.
Experts believe it is still too early to expect a new wave of major selling in the near term. History suggests that as short-term holders return to profit, overall sell pressure subsides and the market stabilizes.
In summary, both retail investors and major institutions are showing little willingness to offload their holdings at present. With exchange balances at a six-year low and technical signals reflecting reduced sell pressure, analysts interpret these shifts as signs of near-term relief and potential stability for Bitcoin’s price action.
