Bitcoin's recent struggle to maintain its position above $120,000 has been attributed to a significant surge in selling activity from large holders, identified by analysts as the "third major profit-taking wave of this bull run". This wave is characterized by substantial realized profits, reaching between $6 billion and $8 billion in late July. On-chain analytics firm CryptoQuant notes that these profit levels coincide with or are near local tops observed in March and December 2024, suggesting a recurring pattern of investor behavior.
This latest sell-off is primarily attributed to "new whales," entities that have recently amassed Bitcoin holdings. In the cryptocurrency world, a "whale" is defined as an entity holding at least 1,000 BTC, capable of influencing market movements. The emergence of new whales suggests the growing involvement of institutional investors or corporations, who likely entered the market more recently.
Previous profit-taking waves occurred after the launch of U.S. spot Bitcoin exchange-traded funds (ETFs) and leading up to the inauguration of U.S. President Donald Trump. These periods were followed by a cooling phase in the crypto market. However, the cooling phase that followed Trump's inauguration escalated into a full-blown sell-off in early 2025 due to concerns about economic growth and inflation fueled by Trump's tariff policies. The market has since rebounded, with Bitcoin reaching new all-time highs above $123,000 in July.
While new whales are driving the current profit-taking, older whales have also resurfaced. An entity that had been dormant for years, accumulating 80,000 BTC during the Satoshi Nakamoto era, recently realized $9.7 billion in profits. This transaction was executed via Galaxy Digital in multiple tranches through major exchanges like Binance, Bybit, Coinbase, and Bitstamp. Despite a brief 4% dip in Bitcoin's price following this sale, the market quickly recovered, indicating strong demand.
Analysts believe these profit-taking waves are a normal part of market cycles, helping to maintain liquidity and stabilize price appreciation. High levels of realized profit can signal shifts in market sentiment and potential turning points, often preceding periods of consolidation or correction. Strategies like dollar-cost averaging and identifying accumulation zones during dips are recommended for retail investors to manage market volatility and maintain a long-term investment approach.
The current bull cycle is unfolding in a more mature market environment with greater institutional participation and improved infrastructure. The absorption of large sell-offs without catastrophic price collapses indicates growing institutional confidence and market resilience.
Despite the recent profit-taking, the Bitcoin market has shown remarkable stability. A significant portion of market participants still hold their coins at a meaningful unrealized profit, with over 97% of the circulating supply held despite prices trading above their original acquisition price. Bitcoin's resilience was tested when the market absorbed a $9.6 billion sell-side event involving the distribution of 80,000 BTC. The price stabilized quickly, underscoring the depth and maturity of current market liquidity. Bitcoin is currently trading between $105,000 and $125,000, and a breakout beyond this range could shift market dynamics.
Following the 80,000 BTC transaction, the Net Realized Profit/Loss (NRPL) metric surged to a cycle high of $3.2 billion but has since cooled to $1.4 billion, suggesting that initial profit-taking may have peaked. While the market is absorbing the newly circulated supply without significant downside pressure, the NRPL remains elevated, indicating the potential for further selling pressure.
