Bitcoin price is experiencing a historic supply squeeze, with exchange balances at a seven-year low and long-term holders continuing to accumulate. At the same time, whales have realized nearly $800 million in profits, signaling potential volatility ahead.
Whales Cash Out $800M as Bitcoin Price Holds Above $95,000
According to market analyst Ali, long-term Bitcoin (BTC) whales have realized $799.668 million in profits, marking one of the largest profit-taking events in recent months. The data from CryptoQuant also indicates a high value of realized profit while BTC price was approximately $ 97,788 on 4th February 2025.
Historically, large spikes in profit-taking by whales have often led to short-term price corrections, as major holders sell a portion of their BTC.
However, despite this selling pressure, Bitcoin has managed to stay above $95,000, suggesting that strong buying demand is helping to absorb the sell-off. If demand remains steady, BTC could consolidate above $97,000 and make another attempt toward $100,000.
Bitcoin’s Exchange Supply Hits a 7-Year Low
Analyzing the trend in the distribution of BTC by exchanges, it is possible to identify one of the most significant changes, the outflow of coins from the exchanges.
Further analysis of the exchange supply via CryptoQuant reveals that the supply of Bitcoin is at its lowest it has been in 2018 signifying that there is low supply of Bitcoin in exchanges and thus less supply is up for trading.
When Bitcoin is taken off exchanges, it generally translates to a bullish trend because the investors are holding instead of trading their coins. This shift moderates the selling pressure which in turn results in stability of the price of the asset when demand eventually increases.
OTC (Over-the-Counter) desk likewise has decreased with a maximum of 300,000 BTC, and all of these suggesting a supply squeeze.
Large and institutional investors and high net worth individuals principally engage in OTC trading to execute large volume trades. The decrease in the balances in OTC means that traders are holding Bitcoin and taking them off the active trading platform.
Long-Term Holders Continue to Accumulate
Consistently, LTHs are accumulating more bitcoins, while short-term holders (STHs) are selling their bitcoins due to volatilities in the market prices. In the past, the best performing Bitcoin rallies have been seen when the primary group of large investors have been known to accumulate aggressively as is the case now.
As the exchange supply is shrinking and whales keep accumulating more coins, the long-term supply conditions of Bitcoin remain rampantly bullish. If the accumulation rate persists, there could be appreciation in the price of BTC in the future months.
Analysing the previous history of Bitcoin one can observe that it is in probable proximity to an inflection point when retail sales drop and institutions buying increases, which forms new tendencies.
Bitcoin Price Breaks Out of Falling Wedge, Faces Resistance
On the 4-hour Bitcoin trading chart we have a falling wedge, which is a bullish pattern that may prompt an uptrend soon. First, BTC began to rapidly rise once it crossed this formation, however, the price faced resistance in the $97,500 – $98,000 levels. This pulled Bitcoin’s price back slightly to $95,788, which is 1.27% less than the previous value at $97,421.
The Relative Strength Index (RSI) currently stands at 39.76, it is below half the 50 mark at half. This implies that the bearish pressure has begun picking steam and the price can drop lower in case of low buying pressure. When the RSI dips, it is an indicator that buyers are trending weak hence the need for BTC to hold key levels.
What’s Next for Bitcoin?
Thus, while BTC price may exhibit short term volatility, fundamentals such as supply constraints, lower exchange balances, and holding accumulation point to long-term potential of the digital asset. Thus, if the BTC price manages to hold above $95,000, demand may resume driving the price toward $100,000 and more.
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