Bitcoin has fallen below the $90,000 level, intensifying speculation that the market may be entering the early stages of a broader bearish cycle. The drop comes as on-chain and derivatives data reveal a notable shift in investor behavior, especially among large holders.

According to a recent CryptoQuant report by Darkfost, whales have become significantly more active on Binance, driving a marked increase in BTC inflows to the exchange. This rise in transfers exceeding 100 BTC suggests that the market’s largest players have begun adjusting their positioning, often a sign of evolving risk attitudes and strategic repositioning.

Meanwhile, Bitcoin has been in a corrective phase for nearly two months, consolidating after its prior rally. This pause has been accompanied by a sharp contraction in Open Interest, which has fallen from $47.5 billion to roughly $29 billion today.

The decline reflects substantial disengagement from speculative positions, whether triggered by cautious profit-taking or by liquidations cascading through the derivatives market.

Whale Defense Intensifies as Retail Investors Remain Passive

Darkfost highlights that the rise in whale inflows—measured using a 90-day average—offers a deeper understanding of the current market mood. This metric shows that major holders are prioritizing protection in an increasingly uncertain environment.

Since Bitcoin’s last all-time high, the average whale inflow to Binance has effectively doubled, now approaching 4,000 BTC. Such an increase is rarely insignificant; it typically reflects hedging, de-risking, or preparing liquidity for active repositioning.

In contrast, inflows from retail investors have remained relatively stable and far less volatile. Their exchange activity has not experienced the same directional surge, suggesting that smaller market participants have not meaningfully adjusted their exposure. This divergence creates a striking behavioral split between investor classes.

While whales shift into a defensive posture—moving coins, reassessing exposure, and potentially preparing for further downside—retail participants appear more passive. This may indicate slower reaction times to macro and on-chain signals or simply lower capital at risk.

Historically, such patterns emerge during transitional phases in the market, when sophisticated holders take early precautionary measures before broader sentiment shifts. The growing contrast reinforces the idea that Bitcoin is navigating a phase where caution dominates among its biggest players.

Bitcoin Tests 200 SMA as Market Searches for Direction

Bitcoin’s 3-day chart shows a decisive shift in momentum, with price breaking below the 50 SMA and 100 SMA after weeks of persistent selling pressure. The failure to hold the $90,000 level pushed BTC into its sharpest correction since mid-2024, and the structure now reflects a market struggling to stabilize. The current candle cluster is forming directly on top of the 200 SMA, a historically significant long-term support zone that often separates cyclical uptrends from deeper bearish phases.

The reaction so far has been mixed. BTC briefly dipped below the 200 SMA before recovering back above it, signaling that buyers are attempting to defend the trend boundary. However, the bounce lacks conviction, and volume remains elevated on down candles—an indication that sellers are still aggressive. As long as BTC trades below the 50 and 100 SMAs, the market structure remains vulnerable.

The downtrend also shows a clear sequence of lower highs and lower lows, confirming that momentum favors continuation unless $92,000–$95,000 is reclaimed. Losing the 200 SMA on a closing basis would open the door to deeper retracements toward $78,000 and $72,000, where prior consolidation zones sit.

Featured image from ChatGPT, chart from TradingView.com

Following a rebound in the broader cryptocurrency market on Sunday, Bitcoin‘s price moved back above the $91,000 mark. Despite this bullish price action, which was brief as BTC has lost the level, major BTC holders are sharply exiting the market, raising questions about the stability of the current bounce.

A Key Bitcoin Cohort Has Stopped Accumulating

In the ongoing market recovery, there has been a shift in sentiment among Bitcoin key investors. A recent report by Joao Wedson, a market expert and founder of Alphractal, reveals that BTC’s typically unshakable giants, also known as whales, have now gone quiet.

Following several months of strategic buying activity, the whale cohort, those wealthy individuals who frequently control and influence market trends, has abruptly stopped accumulating. Specifically, this fading buying enthusiasm is spotted among wallet addresses holding between 100 BTC and 1,000 BTC.

According to the market expert, this shift in sentiment from the whale cohort is a development that demands close attention as the market fluctuates. This is likely because the absence of whale-sized demand creates an extra layer of complexity in the market, causing speculations about whether this is just a time of careful observation. Perhaps the first scene of a more extensive structural change.

Joao Wedson highlighted that this range often represents the real big players, funds, companies, and professionals, as most wallet addresses holding over 1,000 BTC are linked to crypto exchanges. What’s interesting about the current pause in whale accumulation is its similarities with that of the 2021 bull market cycle before prices drastically plummeted. 

Just like in 2021, the whale cohort has ceased to accumulate BTC, and the annual fluctuation has begun to decline. Meanwhile, after months of fading buying activity from these investors, the price of Bitcoin dropped sharply, triggering a bear market phase.

Wedson has addressed any misconceptions toward the trend, noting that this is not a rule nor an automatic sell signal. However, it does demonstrate that major players are currently, at the very least, less enthusiastic about adding to their BTC stash.

Whales Are Currently Shorting BTC

While Bitcoin recovered above $91,000, whale investors were increasingly bearish about the recent bounce. In another post, Wedson reported an unusual tilt as large investors are quickly reducing their long positions or even raising their short positions in BTC.

BTC whales may be opening more short positions, but retail investors are continuously leaning into the upward direction. The contrast is dramatic, a sort of market structure in which small-investor zeal is overshadowed by deep-pocketed prudence.

Wedson, this divergence normally leads to a period of sideways price action, as seen back between March and April this year. However, this trend might imply that some bears are likely targeting the $80,000 price level again in order to sustain accumulation. At the time of writing, the Bitcoin price was trading at $86,275, exhibiting a more than 5% decline in the past day.

On-chain data shows New Whales on the Bitcoin network have been realizing losses recently, while Old Whales have remained at the sidelines.

Bitcoin Has Faced Loss Selling From The Newbie Whales

In a new post on X, CryptoQuant community analyst Maartunn has talked about the latest trend in the profit/loss realization behavior of the Bitcoin whales. “Whales” broadly refer to the BTC investors that hold at least 1,000 tokens in their balance.

At the current exchange rate, the cutoff for the cohort is equivalent to $91.6 million, which is quite significant. As such, this group represents the big-money hands of the market, who can carry some degree of influence.

Whales can be divided into two subgroups based on holding time. Investors of this size who purchased their coins within the past 155 days are known as the short-term holder (STH) or New Whales. Similarly, whales with a longer holding time are called the long-term holder (LTH) or Old Whales.

Now, here is the chart shared by Maartunn that shows the trend in the net amount of profit/loss that these Bitcoin whale groups have been realizing through their selling over the last few months:

As displayed in the above graph, the Bitcoin New Whales have shown some loss realization spikes recently. This underwater selling from the cohort has come as the cryptocurrency’s price has gone through a decline.

The New Whales include the inexperienced hands of the market who tend to easily panic in the face of volatility. It would appear that this quality of the group has held through the latest crash as well.

The Old Whales, on the other hand, are considered to represent the resolute side of the network. From the chart, it’s visible that there has been some loss selling from these large dormant entities recently, but its scale has been small compared to the New Whale capitulation.

The fact that the presence of the Old Whales has been relatively muted through the bearish shift, as well as the rebound that has followed, could be a signal worth keeping an eye on.

Speaking of the recovery, the Bitcoin rally has meant that its price has climbed back above a major on-chain cost basis level. As analyst Ali Martinez has shared in an X post, the Bitcoin UTXO Realized Price Distribution (URPD) suggests a strong amount of buying last occurred at $84,500.

In on-chain analysis, strong demand zones below the spot price are considered points of potential support for Bitcoin. Similarly, levels above are assumed to be sources of resistance instead. One such major level is present at $112,300.

BTC Price

Bitcoin’s recovery has furthered during the past day as its price has returned to $92,300.