Bitcoin (BTC) Reaches a Potential Topping Point

Bitcoin (BTC) Reaches a Potential Topping Point

The Drying Up of Long-term Bitcoin Supply: Signaling a Possible Market Top?

Bitcoin's long-term investors have been sitting tight, resulting in a significant increase in the number of coins with no movement for over 155 days, reaching a staggering 14.29 million BTC as of recent data. This information was shared by Glassnode on May 14.

Long-term investors' spending ratio, which monitors the amount of Bitcoin moving from long-term wallets, has also peaked at 0.43. Historically, this ratio has shown an uptrend before local market tops.

A Word of Caution from Analysts

WhaleWire analyst Jacob King, with an impressive following of 520k on X, predicts that Bitcoin is forming a classic double top pattern, a historical indicator that could signal the end of a major bull cycle.

King further asserts that the rally was not organically driven but rather by manipulations and USDT inflows, suggesting an overvalued market that could be in for a shock.

Institutional Investors: Buying Up the Bull

After taking a significant hit in early 2025 and dropping almost 32% in value, Bitcoin had a remarkable comeback in May, skyrocketing from $94,000 to $105,747 on May 12. Institutional investors are believed to have played a decisive role in this surge.

Strategic investments added a staggering 1.34 billion dollars worth of BTC, boosting their total holdings to a whopping 569,000 BTC. Japan-based Metaplanet also joined the fray, acquiring another 1,241 BTC, bringing their total to 6,796 BTC. Simultaneously, Bitcoin spot ETFs witnessed net inflows of $1.94 billion over the past month.

According to Santiment, approximately 68% of Bitcoin's supply is in the hands of institutions, with no significant sell signals observed yet.

The Short and Medium-term Forecast

Data suggests a potential short-term pullback if individual investor sentiment starts to waver. However, institutional buying and ETFs' daily accumulation of roughly 5,000 BTC could offer support to Bitcoin, later impelling a renewed upward trend following recent corrections.

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Insights:

• Bitcoin’s long-term investor supply—coins seldom traded—has grown significantly over the past month, accounting for nearly two-thirds of the total mined supply[3][4].
• Historically, an increase in long-term holding tends to correlate positively with Bitcoin's price appreciation since 2019, suggesting stronger price stability and less liquid supply available for short-term trading[3].
• Bitcoin's total supply remains at approximately 19.86 million coins, with a growing portion being illiquid[2].
• The persistent double top pattern in Bitcoin's price history could indicate potential resistance and subsequent market corrections[1].
• Institutional investors are stepping up their Bitcoin accumulation, particularly mid-tier holders, which, along with strategic investments and ETFs, supports underlying demand and market stability[5].

Bitcoin's long-term investors, including institutional entities, are increasingly investing in and holding Bitcoin, as evidenced by the significant growth in long-term Bitcoin supply, reaching 14.29 million BTC as of recent data. This trend in technology-driven finance, such as blockchain investments, could potentially signal a renewed upward trend in the market, despite the potential for market corrections hinted by historical indicators like the double top pattern.

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