Bitcoin is trading in a holding pattern around $68,228.29, but a divergence in ownership patterns is emerging as a key factor to watch. Since October, when the cryptocurrency reached its all-time high, retail investors have been steadily accumulating Bitcoin, while larger holders—often referred to as whales and sharks—have been reducing their positions.
Data from on-chain analytics firm Santiment reveals that wallets holding less than 0.1 BTC have grown by approximately 2.5% since the October peak, reaching their highest share of total supply since mid-2024. Conversely, wallets holding between 10 and 10,000 BTC have decreased their holdings by roughly 0.8% over the same period. This split in activity is creating a dynamic that historically leads to volatile and indecisive price action.
“Calls for Bitcoin to hit $150k to $200k, and even $50k to $100k, are drying up,” Santiment said in a report on Friday. “This reduction in FOMO and ‘Lambo’ memes is actually a healthy market indicator. It shows that retail optimism is fading.” The sentiment platform noted that overall Bitcoin sentiment has recovered from “extreme bearishness” to “neutral territory,” potentially making trading decisions more challenging for market participants.
The situation contrasts with a brief period of synchronized buying earlier this month. Following a drop to near $60,000 on February 5, Glassnode’s Accumulation Trend Score reached 0.68, the strongest reading since late November. This was driven primarily by wallets holding between 10 and 100 BTC aggressively buying the dip, suggesting a shift from market capitulation. However, Santiment’s broader analysis, encompassing wallets up to 10,000 BTC, indicates that the net positioning of larger holders remains negative since October.
Analysts suggest that the mid-sized wallets may have been responsible for the dip-buying activity, while the largest holders continued to distribute their holdings into any price recovery. This dynamic is creating a situation where retail buying provides short-term support, but a sustained rebound requires larger holders to halt sales or start accumulating Bitcoin.
According to a report from VanEck released February 21, Bitcoin has dropped 29% over the past 30 days, pushing the Net Unrealized Profit/Loss (NUPL) indicator closer to the “Fear” zone. Leverage has also reset, with open interest falling to levels last seen in September 2024. The report highlights that mid-term holders (those holding BTC for 1-5 years) are dominating selling pressure, although the pace of distribution has slowed in the past month.
The key question now is whether whales will pause selling pressure and shift to structural buying. Without that shift, every rally risks being met with selling from the remarkably cohort that needs to provide sustained demand for a successful price increase. Retail investors are currently accumulating, but their efforts alone may not be enough to drive a significant and lasting price movement.
