Bitcoin Traders Flood Market With Supply—Is This the Calm Before the Next Rally?

Whale wallets just unloaded a staggering amount of BTC into exchanges—an early warning system for price volatility. But here’s the twist: exchange reserves aren’t ballooning like you’d expect during pure profit-taking.

Behind the numbers: This smells like fresh OTC deals getting routed through exchanges to dodge slippage (and maybe some tax paperwork). When institutions want in but don’t want to move markets, they play these shell games. Classic Wall Street tactics, now with blockchain transparency.

The kicker? Bitcoin’s price barely flinched. Either we’re seeing monster buy-side absorption... or traders are prepping for something bigger. Remember: in crypto, ’supply shocks’ work both ways—especially when ETF flows are still sucking coins out of circulation faster than miners can print them.

As always, watch the derivatives market for confirmation. If open interest spikes alongside these transfers, someone’s building leverage for a move. And if not? Well, even broken clocks are right twice a day—just ask the ’inflation hedge’ crowd from 2022.

Bitcoin Short-Term Holder Supply Has Registered An Uptick

In a new post on X, the market intelligence platform IntoTheBlock has talked about how the different Bitcoin cohorts have seen their supply change recently. The groups in question have been divided on the basis of holding time.

The analytics firm classifies the investors into these groups: ‘traders’ who purchased their coins within the past month, ‘cruisers’ who did so between one and twelve months ago, and ‘HODLers‘ who have been holding for more than a year.

Generally, the longer an investor holds onto their coins, the less likely they are to sell them in the future. Thus, the holder resolve gets stronger as one goes from the traders to the HODLers.

Now, here is the chart shared by IntoTheBlock that shows the trend in the net change of the balance held by each of these groups during the past decade:

As displayed in the above graph, the Bitcoin traders have registered a positive value on this metric recently, suggesting the balance held by the group has gone up. This increase for this cohort has come as BTC has been witnessing a price rally.

Whenever the supply of the traders observes a rise, it means members of one or both of the older cohorts are breaking their dormancy. Given that the latest surge has coincided with an uplift in the asset’s price, it’s possible that it’s an indication of profit-taking in the market.

From the chart, it’s visible that the HODLers have also seen a positive change recently, implying these diamond hands are continuing to hold tight. This leaves the cruisers as the only group that can be responsible for the selling, and indeed, the negative balance change would confirm so.

The cruisers are more resolute than the traders, but even they can be prone to panic selling as they haven’t quite achieved the same stalwartness as the HODLers, so the latest distribution from them may not be too surprising.

While the profit-taking may not be a positive sign for Bitcoin, the increase in the trader supply could be looked at from a more bullish perspective: it could imply there is fresh demand flowing into the sector.

This was seemingly the case back during the rally that occurred in the last couple of months of 2024, where the trader supply change spiked high into the positive territory.

“If this influx persists, it supports the view that the current move is more than a relief rally and could be the opening leg of a broader uptrend,” notes the analytics firm.

BTC Price

Bitcoin saw a pullback below $93,000 yesterday, but it appears the coin has regained bullish momentum as its price has now surged to $95,200.