With nearly 10 billion in sell pressure, the market remains unmoved. Is Bitcoin heading straight for 140,000?

Bitcoin holders' unrealized profits recently reached a historic peak of $1.4 trillion, with $140,000 potentially being a key price for whales to take profits.

Written by: UkuriaOC, CryptoVizArt, Glassnode

Compiled by: AididiaoJP, Foresight News

Last weekend, the liquidity of Bitcoin underwent a significant test as an early investor sold over 80,000 BTC through Galaxy Digital's OTC trading service. Nevertheless, the market displayed strong resilience, with the vast majority of investors choosing to hold rather than realize paper profits.

Executive Summary

Last weekend, Bitcoin's liquidity faced severe challenges as an early large investor sold over 80,000 BTC through Galaxy Digital's OTC trading service. Although this sell-off, amounting to $9.6 billion, put pressure on the market's upward movement, the market quickly absorbed the massive selling pressure, with prices briefly dropping to $115,000 before swiftly stabilizing at $119,000, slightly below the all-time high.

Even after such a large-scale sell-off event, the unrealized profit held by market participants remains considerable. Currently, the total unrealized profit amounts to 1.4 trillion dollars, with 97% of the circulating supply still in a profitable state.

According to multiple on-chain valuation models, the price of Bitcoin is currently fluctuating within the range of $105,000 to $125,000. If an effective breakout occurs, the price may further rise to $141,000, as this price point is expected to see a significant amount of unrealized profit being realized, which may face significant selling pressure.

Depth Liquidity

Realized Cap is a fundamental metric in on-chain analysis used to quantify the total liquidity in the Bitcoin network priced in US dollars. Currently, this metric has surpassed $1.02 trillion, highlighting the increasing liquidity depth and market thickness of this asset.

Last weekend, this liquidity underwent a real test. An early Bitcoin investor sold 80,000 BTC (approximately $9.6 billion) through the services of Galaxy Digital, possibly via a mix of market sell-offs and OTC trades. The resulting selling pressure pushed the price down to $115,000, before stabilizing at $119,000.

This event highlights the ability of Bitcoin to absorb large sell orders even during weekend trading periods when liquidity is typically thin, confirming the robustness of the market structure.

This event also drove the Net Realized Profit/Loss indicator to a historic peak of $3.7 billion. It is worth noting that the surge in this indicator occurred ahead of the weekend sell-off, reflecting the early movement of funds before final allocation.

As the batch of tokens was initially marked as internal transfers by the entity-adjusted algorithm, subsequent address changes conducted through Galaxy Digital were recorded as economically meaningful transactions, namely ownership changes.

The recent surge in profit-taking has driven the Realized Profit/Loss Ratio to accelerate sharply, currently achieving a profit that is 571 times the losses. This value is at an extremely high level, with only 1.5% of trading days in history exceeding this level.

However, interpreting this signal requires caution. While extreme profit-taking behavior may accompany price tops (such as the situation at the historical high of $73,000 on March 7, 2024), this is not an immediate reaction. For example, when breaking through $100,000 at the end of 2024, the peak of profit-taking occurred at the $98,000 level, but the market subsequently continued to rise by 10% to $107,000 before peaking.

This lag indicates that significantly increased profit-taking often foreshadows (but does not immediately lead to) market exhaustion. It creates supply pressure that takes time to digest, and the market response may have a time lag.

Holder Duration Analysis

After digesting a large number of long-term dormant tokens, the Long-Term Holder Net Realized Profit/Loss reached a historical high of $2.5 billion, surpassing the previous peak of $1.6 billion. This marks the largest single sell-off event in Bitcoin's history, an extreme liquidity stress test; however, the market has shown remarkable resilience, with prices consistently oscillating near historical highs.

This further confirms the extraordinary resilience of the Bitcoin market during significant distribution events, having previously witnessed challenges such as the Mt. Gox compensation and the German government's sell-off in this cycle.

By comparing the supply ratio of long-term and short-term holders, it can be seen that during the formation of the three historical peaks in this cycle, the same pattern has emerged: after the initial accumulation phase, there is always a sharp transition towards aggressive distribution.

The current allocation phase is still ongoing, and the LTH/STH supply ratio continues to contract. Over the past 30 days, this ratio has decreased by 11%, with only 8.6% of trading days experiencing more severe declines, highlighting the intensity of the shift in investor behavior.

Unrealized Profit Analysis

Despite facing significant selling pressure last weekend, including large-scale profit-taking by long-term investors, the Bitcoin market remained unusually stable. As a result, the vast majority of participants still hold considerable unrealized profits, with 97% of the circulating supply's current holding cost below the spot price.

The total paper profits held by market participants (i.e., unrealized gains) have recently reached a historical peak of $1.4 trillion. This indicates that most investors are sitting on substantial floating profits, which could trigger potential selling pressure in the future if prices continue to rise.

We can also observe the ratio of unrealized profit market capitalization as a standardized indicator. Currently, this indicator has once again surpassed the +2σ range, a level that historically coincides with market euphoria and the formation of historical peaks. This reaffirms, from a standardized perspective, the reality that participants hold significant unrealized profits.

This indicates that many investors hold an optimistic attitude towards market conditions, which serves as both a booster of sentiment and suggests that the motivation for subsequent profit-taking may strengthen.

Unlike previous cycles, the current long-term holders still control 53% of the wealth. Although this group continues to distribute during this cycle, this proportion remains considerable in an environment where unrealized profits are at a high level.

Overall dynamics show that long-term holders may still have further selling pressure. As prices rise to enticing levels that are enough to activate dormant whale tokens, the market needs more demand inflow to absorb the selling pressure.

Market Cost Analysis

The distribution chart of Bitcoin cost basis shows that there is a significant accumulation of cost basis in the range of $117,000 - $122,000. This indicates that a large number of investors have accumulated in this high price range.

It is worth noting that there is a trading volume vacuum zone in the range of 110,000 to 115,000 USD below the spot price, which is the result of insufficient turnover during the rapid price increase process. Not all vacuum zones need to be filled, but there is price gravity in this area, and the market may need to test the validity of this support, making it a key area to focus on during pullbacks.

The cost basis of short-term holders (representing the average position cost of new investors) has historically been a key threshold for distinguishing local bull and bear market conditions. By overlaying standard deviation ranges, statistical dimensions can be increased:

• STH CB +2σ: 141,600 USD
• STH CB +1σ: 125,100 USD
• STH cost basis: 105,400 USD
• STH CB -1σ: 92,100 USD

The key observation is that the price of Bitcoin remains above the short-term holder cost basis, which is a positive signal for a strengthening market. In addition, in all major top structures during this cycle, the price has faced resistance in the +1σ range, and the current pattern is no exception.

The macro perspective shows that before a decisive breakthrough, Bitcoin may maintain a fluctuation range of $105,000 - $125,000. If a valid breakthrough occurs, the $141,000 area (corresponding to the +2σ range) may become the next strong resistance level, where on-chain indicators suggest that selling pressure may increase sharply.

By analyzing the cost basis of internal subgroups of short-term holders, a "fast-slow cost basis band" can be constructed as a momentum indicator of short-term market sentiment. The current price is still above the cost basis of all short-term subgroups, indicating market strength. Notably, the cost basis band of holders from 24 hours to 3 months (110,000 - 117,000 USD) highly overlaps with the low volume area in the cost basis distribution chart.

The resonance of multiple independent indicators reinforces the significance of this price area, suggesting that it may become a key support during pullbacks.

To gain deeper insights into the momentum of subgroups, we use an equal-weight composite index to measure the proportion of profitable subgroups. This index has been consistently above the mean and is approaching the +1σ level, indicating that the current market momentum is robust, and most new investors are still in a profitable state.

Summary and Conclusion

Last weekend, Bitcoin's resilience faced a severe test as the market efficiently absorbed the sale of 80,000 BTC (worth $9.6 billion), marking one of the largest profit-taking events in its history. Despite the astonishing trading volume, the price quickly stabilized near historical highs, highlighting the current depth and maturity of market liquidity.

Currently, Bitcoin is oscillating between the range of 105,000 - 125,000 USD. A valid breakout of this range could change the market dynamics, making 141,000 USD the next focal point, with on-chain indicators suggesting that there could be significant profit-taking in this area. Conversely, the low-volume zone between 110,000 - 115,000 USD below the current price is worth close attention; if a pullback occurs, this area will become a key observation point.