Bitcoin's momentum slows as profit-taking hits $650B

Bitcoin surged to an all-time excessive final month, bolstered by rising institutional demand and a wave of Wall Road adoption.

Nonetheless, the rally has since slowed, and BTC has been caught in a slender vary. It even briefly fell underneath $100,000 amid geopolitical tensions involving Israel, Iran, and the US.

Whereas Bitcoin’s worth rapidly recovered to round $106,000 after stories signaled a de-escalation, many within the crypto neighborhood anticipated continued upside momentum to push its worth to a brand new ATH. Nonetheless, on-chain knowledge exhibits long-term holders are promoting into the weakening market momentum, which is hindering one other upward run.

Lengthy-term holders promoting

One main issue protecting Bitcoin in a decent vary is the size of realized earnings.

Glassnode reported that over $650 billion in earnings have already been realized on this cycle, surpassing totals from the final bull run. Most of that got here from three main promoting waves, and analysts consider the market is now in a cooling section after the most recent one.

Based on the report:

“At present, the market seems to be in a cool-down section after the third vital wave of profit-taking, indicating that whereas massive positive factors have been secured, momentum is now easing as realized profitability tapers off.”

On-chain knowledge from Bitcoin analyst James Test confirmed that a lot of the promoting has been pushed by long-term holders, notably those that have held Bitcoin for at the least three years.

Charles Edwards, founding father of Capriole Funds, additionally said that Bitcoin’s worth stagnation round $100,000 since January is principally on account of long-term holders promoting after the ETF launch.

Edwards additionally identified that latest purchases by 6-month+ holders, presumably institutional traders like Bitcoin Treasury firms, have absorbed a good portion of the sell-offs, suggesting a market flywheel impact.

He wrote:

“This dynamic is now beginning to seem within the onchain knowledge, and we are able to see that 6 month+ BTC holders have skyrocketed over that 2 month interval. The quantity of BTC acquired within the final 2 months by this cohort has utterly consumed the entire BTC unloaded by LTHs during the last 1.5 years.”

Weakening market momentum

Other than the numerous promoting actions, Glassnode additionally identified that one more reason for Bitcoin’s worth efficiency is because of its weakening on-chain quantity.

Based on the corporate, BTC’s on-chain quantity has dropped roughly 32% over latest weeks, from a $76 billion excessive to round $52 billion. In contrast to earlier rallies, the transfer to $111,000 didn’t carry a spike in buying and selling exercise. Spot quantity sits at simply $7.7 billion—nicely beneath earlier cycle peaks.

It famous:

“This divergence additional underscores the dearth of speculative depth, highlighting the market’s hesitancy and reinforcing the consolidation narrative.”

Furthermore, the futures markets have additionally proven indicators of fatigue.

Whereas leveraged merchants remained lively through the latest $111,000 transfer, the urge for food for danger seems to be fading.

As well as, the annualized funding charges and 3-month rolling foundation have decreased for the reason that Q1 2025 excessive. This means a shift towards defensive methods like cash-and-carry arbitrage or brief positions, reasonably than aggressive lengthy bets.

Contemplating this, Bitcoin might keep range-bound due to the decreased speculative strain and weaker buying and selling indicators till a contemporary catalyst emerges.