Bitcoin News: BTC Whale Selling Deepens as Bear Signals Multiply

Key Insights

• Bitcoin news showed that BTC whale selling accelerated as retail wallets increased holdings.
• On-chain signals pointed to an early-stage bear market transition.
• Exchange inflows suggested rising distribution risk, not capitulation.

Bitcoin News: The largest crypto by market cap entered February under sustained pressure. It appears that large BTC holders are reducing their exposure while smaller wallets accumulate, reinforcing mounting bear market signals.

Santiment data showed this divergence intensified during the recent drawdown. It reflects behavior patterns that historically aligned with extended bearish cycles rather than short-term pullbacks.

The Bitcoin move followed a sharp repricing phase that forced risk reassessment across derivatives and spot markets. That reaction mirrored earlier cycle transitions where distribution preceded deeper structural weakness.

The Bitcoin news backdrop remained fragile, as sentiment gauges, exchange flows, and realized loss metrics pointed to deterioration rather than stabilization.

Bitcoin News: BTC Whale Supply Fell as Distribution Accelerated

Santiment data showed whale and shark wallets holding between 10 and 10,000 Bitcoin dropped to their lowest combined supply share in nine months.

This shift occurred because large holders reduced exposure aggressively during the latest decline, transferring risk to smaller participants rather than absorbing sell pressure.

Bitcoin news showed an outflow of 81,068 Bitcoin from these wallets over eight days. That move coincided with a 27% market decline.

Meanwhile, it reinforces the view that selling pressure originated from dominant supply holders rather than panic-driven retail exits.

Santiment stated this pattern historically preceded bear cycles when retail accumulation failed to offset sustained whale distribution. The structure suggested supply dispersion, not accumulation, dominated recent flows.

Bitcoin Exchange Inflows Pointed to Elevated Distribution Risk

Arab Chain flow data showed Bitcoin inflows to Binance surged to their highest whale ratio since 2022. Total inflows reached 78,500 Bitcoin, with large wallets contributing about 38,100 Bitcoin during early February trading sessions.

This shift occurred after Bitcoin price volatility increased and liquidity conditions tightened across centralized exchanges. Nearly half of the deposited BTC originated from whales, a structure often associated with portfolio repositioning or risk reduction rather than long-term storage.

Arab Chain noted elevated whale inflow ratios historically aligned with market transition phases. In past cycles, similar readings preceded either temporary selling pressure or extended consolidation before further downside.

The data did not confirm immediate liquidation intent. However, the concentration of large-wallet Bitcoin deposits increased downside sensitivity during periods of weak demand absorption.

SOPR Data Signals Early BTC Bear Market Entry

On-chain analyst Woominkyu reported Bitcoin’s Spent Output Profit Ratio fell below 1.0, indicating coins moved at realized losses. This development historically marked regime shifts rather than final bottoms, especially when sustained over multiple weeks.

The analyst compared current conditions with prior cycles in 2018, 2020, and 2022. In each case, prolonged SOPR weakness appeared early in bear markets, followed by failed recoveries and deeper drawdowns.

Loss realization increased, but panic indicators remained muted. Price action weakened, yet metrics associated with forced capitulation failed to emerge, suggesting sellers still acted selectively.

Woominkyu concluded that the Bitcoin price market had entered a bear phase but had not completed its adjustment. Historical precedents showed bottoms formed only after repeated failed SOPR recoveries and broader loss distribution across holders.

Retail Accumulation Failed to Offset Structural Pressure

Bitcoin news also showed that BTC shrimp wallets holding less than 0.1 Bitcoin rose to a 20-month high. This cohort expanded steadily since mid-2024, increasing its share of total supply to roughly 0.249%, equivalent to about 52,290 Bitcoin.

This shift occurred as smaller investors bought declines while larger entities reduced exposure. Santiment stated this divergence historically reflected misplaced optimism rather than durable demand support during downtrends.

In previous cycles, similar retail accumulation phases preceded further downside before sentiment reset. The pattern suggested delayed capitulation risk rather than a confirmed recovery base.

CryptoQuant chief executive Ki Young Ju reinforced the cautious outlook, stating every major Bitcoin analyst currently leaned bearish. That alignment across sentiment, on-chain metrics, and flow data reduced the probability of a rapid reversal.

What’s Next?

Bitcoin price traded near 65,000 after briefly dipping below 60,000, with market structure pointing to continued downside vulnerability.

Meanwhile, historical SOPR behavior suggested further Bitcoin price adjustment before a durable bottom formed. It has sparked discussions over whether support near the low 60,000s will be held during upcoming sessions.