Bitcoin’s intense selling wave appears to be losing momentum, but large holders are still offloading significant amounts of BTC onto centralized exchanges, according to new on-chain data from CryptoQuant.
The analytics firm notes that overall Bitcoin deposits to exchanges have declined sharply since early February, easing one of the main drivers of downward price pressure. At the same time, wallets controlled by so‑called “whales” continue to send sizeable chunks of BTC to trading platforms-moves that are typically interpreted as preparation to sell.
Bitcoin has already fallen roughly 46% from its October peak, sliding from its highs to trade near the $60,000 mark in early February. That pullback coincided with a surge in BTC being sent to exchanges. On February 6, exchange inflows spiked to around 60,000 BTC as the market reacted to the drop in price.
Since then, the situation has cooled. Over the most recent seven‑day period, average daily exchange deposits have retreated to about 23,000 BTC. CryptoQuant describes this shift as a sign that the most aggressive phase of the sell‑off is over.
“This moderation suggests that the acute sell-off phase has eased, even as exchange flows remain elevated relative to prior months,” the firm wrote. “Lower exchange inflows put less selling pressure on prices.”
In crypto markets, heavy inflows of coins to centralized exchanges are usually a bearish signal. When holders move BTC from cold storage or private wallets to trading venues, it often precedes selling-either to realize profits, cut losses, or rotate into other assets. Conversely, when coins flow off exchanges into long‑term storage, it tends to be read as a vote of confidence that holders are not looking to sell in the near term.
The current pattern suggests that, on a broad basis, holders who were rushing to the exits have largely finished their selling. That’s consistent with the reduction from 60,000 BTC in daily deposits at the peak of the panic to less than half that figure now. It doesn’t necessarily mean buyers are fully back in control, but the immediate flood of supply hitting order books has diminished.
However, the reassuring picture from the aggregate data is complicated by the behavior of whales-large entities holding vast amounts of Bitcoin. CryptoQuant’s report emphasizes that these big players have not slowed their activity to the same extent as the rest of the market. On the contrary, their exchange deposits remain elevated, signaling ongoing distribution.
Whales are crucial to understanding market dynamics because their transactions can move prices more sharply than those of small retail traders. A single whale transferring thousands of BTC to an exchange can add sudden selling pressure, widen bid‑ask spreads, and trigger liquidations in leveraged positions. Even when their orders are broken up or executed over time, the mere visibility of large inflows from whale wallets can sour sentiment.
The divergence between declining total inflows and sustained whale activity paints a mixed picture. On one hand, everyday investors may be stepping back from the panic selling that defined early February, indicating exhaustion among short‑term sellers. On the other hand, continued selling from the largest holders could cap any sharp recovery rallies, as new buying demand has to absorb not only residual retail supply but also whale‑driven sell orders.
From a market structure standpoint, this environment often leads to choppy, range‑bound price action. With the most intense capitulation behind it, Bitcoin can find support zones more easily. But as long as whales keep sending coins to exchanges, attempts to break significantly higher may face strong resistance.
It’s also important to consider the context behind why whales might be selling. Large holders are not a monolithic group. Their behavior can reflect multiple motivations:
– Long‑time holders taking profits after the run‑up to last year’s peak.
– Institutional players rebalancing portfolios after strong gains in BTC relative to other assets.
– Funds reacting to macroeconomic uncertainty, such as interest rate expectations or risk‑off episodes in traditional markets.
– Entities that accumulated BTC at much lower levels and are comfortable realizing gains even amid a pullback.
At the same time, new sources of demand-such as spot Bitcoin investment products in major financial markets-may be quietly absorbing some of this selling. This tug‑of‑war between structural demand and opportunistic or risk‑driven selling helps explain why the price can hold above key thresholds even while whales are active on the sell side.
For traders and longer‑term investors, CryptoQuant’s findings carry several practical implications. First, the decline in overall exchange inflows reduces the probability of another immediate, panic‑driven leg down of the same intensity witnessed when deposits hit 60,000 BTC in a single day. That can encourage more measured risk‑taking among participants who were sidelined during the most volatile phase.
Second, the persistence of whale selling advises caution in assuming that every bounce marks the start of a sustained new uptrend. Short squeezes and relief rallies may still be met with strong overhead supply. That backdrop tends to favor strategies focused on shorter time frames or gradual accumulation rather than aggressive, all‑in positioning.
Third, monitoring on‑chain metrics like exchange inflows, whale wallet behavior, and realized profits/losses becomes especially valuable when price alone offers an incomplete story. A stabilizing price near support levels could look bullish at first glance, but if it coincides with growing whale deposits, it may signal hidden fragility beneath the surface.
Looking ahead, the key question is whether whale activity will eventually converge with the broader market’s cooling trend. If large holders reduce their exchange transfers, the combination of lower overall inflows and easing whale pressure could create a more favorable environment for a sustained recovery. In that scenario, reduced sell pressure would allow any incremental demand to have a stronger impact on price.
Alternatively, if whales continue to sell into every attempt at a rebound, Bitcoin could remain stuck in a prolonged consolidation phase. Historically, such periods often shake out short‑term speculators while patient buyers accumulate at perceived value levels, setting the stage for the next significant move-up or down-once the balance between supply and demand shifts decisively.
It’s also worth noting that periods of heavy selling and high exchange inflows tend to reshuffle Bitcoin’s ownership structure. Coins often move from weaker hands that sell under stress to stronger hands with longer time horizons. If the recent wave of deposits and sales has accelerated that transfer, it may leave a larger share of the supply in the hands of investors less likely to react to short‑term volatility-potentially making future drawdowns less violent once the current distribution phase ends.
Ultimately, CryptoQuant’s data suggests that Bitcoin may be exiting the most acute phase of its recent downturn, but the market is not out of the woods. The broad rush to sell is fading, yet whales remain active in sending coins to exchanges, keeping a lid on bullish enthusiasm. Until that tension is resolved-either through waning whale activity or a decisive surge in demand-Bitcoin is likely to remain sensitive to shifts in macro conditions, liquidity, and investor sentiment.
For now, the takeaway is nuanced: overall sell pressure is easing, but the largest players in the market are still leaning toward distribution rather than accumulation. How long that pattern persists will go a long way in determining whether the next major move for Bitcoin is a renewed climb or a deeper correction.