Is Bitcoin's Sell-Off Finally Running Out of Steam?

Sell-side pressure for Bitcoin, which last week brought the world’s largest crypto to its lowest point since President Donald Trump was elected for a second term, has begun to abate.

Analysts point to increasing demand from large buyers, the balance of aggressive buying and selling, and the percentage of supply in profit as evidence that the drawdown could be running out of steam.

“From the perspective of price action and on-chain distribution, the pace of the decline is indeed decelerating,” Tim Sun, senior researcher at HashKey Group, told Decrypt. “However, we have yet to see a signal for a definitive trend reversal.”

The market remains constrained by tight liquidity, policy uncertainty, and subdued ETF and institutional flows, while evolving regulatory frameworks continue to weigh on risk appetite despite tentative signs of on-chain stabilization.

Bitcoin is down more than 44% from its October 6 all-time high of $126,080, and is currently trading around $69,600, according to CoinGecko data. The extended drawdown has led some to conclude that the broader crypto market is now in bear market territory.

Still, certain on-chain data used to gauge market health has begun to show promising signs, albeit amid strenuous macroeconomic conditions that continue to dampen investor sentiment.

Spot cumulative volume delta remains deeply negative, at roughly minus $327 million, a level Glassnode says has historically coincided with seller exhaustion rather than fresh waves of distribution.

Spot CVD tracks the net balance between aggressive buyers and sellers in the spot market, showing whether demand is being driven by bids lifting offers or sellers hitting bids.

It comes as large buyers, or whales, continue to buy the dip. On February 6, accumulation addresses—which have no outgoing transactions, excluding miners and exchanges—bought 54,458 BTC during last week’s drop, according to CryptoQuant data.

The convergence of large buyers entering a bid amid extreme holder losses often precedes market stabilization. Or so the thinking goes.

“Whale accumulation primarily serves to stabilize price ranges and absorb passive selling pressure rather than immediately triggering a trend reversal,” Sun said.

The share of Bitcoin supply held at a profit has fallen to about 55%, according to Glassnode, leaving a majority of coins underwater.

Glassnode analysts wrote that such conditions are often associated with accumulation, as holders sitting on losses have less incentive to sell, a dynamic that can ease downside pressure and support gradual price stabilization.

Despite the optimism, some analysts caution against the read, noting that shifting market dynamics have led to less outsized impacts from crypto’s formerly formidable buyer cohort.

“Bitcoin holdings are primarily held by institutions now, so it will largely hinge upon their buying decisions to propel the market upwards,” Jeff Mei, COO at BTSE, told Decrypt.

As far as the market is concerned, the next leg higher will depend on whether institutional buyers step back in with sustained demand.

“We believe the sell-off has already started to reverse,” Mei said, adding that any further recovery would depend on easing financial tensions abroad and in the U.S.