Watch on Youtube

Whales Are Selling Bitcoin, Is a Buying Opportunity Near?

Executive Summary

• A Market Divided: Bitcoin whales are taking profits, selling over 18,000 BTC in 11 days—a bearish signal. Conversely, MVRV shows short-term traders are now at a loss, a condition that has historically marked prime buying opportunities.
• Strong Crowd Euphoria: Following President Trump's pardon of former Binance CEO "CZ," crowd sentiment has become extremely greedy. Social metrics are flashing warning signs that often precede market corrections.
• Geopolitical Pressure: Global tensions involving the US, China, and Russia have caused trading volume to drop by 30%, as traders remain on the sidelines waiting for clarity.
• Altcoin Standouts: While the broader market is flat, privacy coins like Zcash (+22%) continue to surge as the sector leads with 12% weekly growth.

Introduction

In another eventful week for the crypto markets, geopolitical tensions and major pardons shifted the landscape for traders. In the latest "This Week in Crypto" episode, our legendary host Brian, provided a data-driven breakdown of the key events. From the market's euphoric reaction to President Trump's pardon of "CZ" to concerning profit-taking from Bitcoin whales, the session offered hard-to-spot insights. This summary captures the most important data points and what they could mean for the market.

Market Movers: Privacy coins show major strength

The week presented a mixed bag for crypto prices. Bitcoin managed a slight 1.6% gain to reclaim the $110k mark, but the overall crypto market cap fell by 2.7%. This suggests broader weakness across many altcoins. However, the privacy sector outperformed. Monero and Zcash posted impressive double-digit gains, continuing their strong performance this year.

• Key Data: Zcash led the pack with a 22% price increase, while Monero gained 10%.
• Actionable Tip: Pay attention to sector-specific trends. When the broader market is flat, capital often rotates into assets with a strong, independent narrative, like privacy coins.

Geopolitical Headwinds: US, Russia, and China trade talks

Global politics are casting a long shadow over the crypto markets, with new US sanctions on Russia's largest oil companies fueling tensions between global superpowers. At the same time, ongoing trade discussions between the US and China are keeping market participants on edge. This uncertainty has contributed to a significant drop in trading volume.

• Key Data: Trading volume across the board dropped by approximately 30% amid geopolitical uncertainty.
• Actionable Tip: Keep an eye on major global news events. Macroeconomic and political developments can directly impact market sentiment and trading activity in crypto.

Pardon Pump: Market reacts positively to CZ pardon

The biggest story of the week was President Trump's pardon of former Binance CEO Changpeng Zhao, who was sentenced in 2023 for money laundering. The market reacted with immediate positivity to the news. The host explained that the crypto community largely views CZ as a heroic figure. The pardon is seen as a positive signal for other innovators, suggesting they may face less risk from regulators in the future.

• Key Data: The pardon of CZ, a key crypto figurehead, became the number one trending topic on social media this week.
• Actionable Tip: Understand that major news and narrative shifts can cause powerful, short-term market reactions that are separate from an asset's technical or on-chain fundamentals.

Sentiment Analysis: Bullishness signals a possible correction

Crowd sentiment is showing signs of excessive optimism. Using social media data, the host revealed that the ratio of bullish to bearish comments is now 1.5-to-1. This means for every three comments, there are two bullish ones. Historically, when sentiment reaches these levels, the market becomes more vulnerable to volatility and potential price corrections.

• Key Data: The ratio of positive to negative comments across social media is currently 1.52-to-1.
• Actionable Tip: Use crowd sentiment as a contrarian indicator. When social media becomes overly bullish and confident, it can be a signal to become more cautious.

More Sentiment Analysis: BNB hits extreme 10-to-1 bullish ratio

The CZ pardon had an enormous impact on sentiment surrounding Binance Coin (BNB). Data shows an incredible 10-to-1 ratio of positive to negative comments about the asset. This wave of euphoria is fueled by speculation that CZ may once again take on a larger role with Binance. While exciting for holders, such extreme sentiment levels can often be a contrarian indicator.

• Key Data: For every one negative comment about BNB, there are now over 10 positive ones.
• Actionable Tip: Be wary when sentiment for a single asset reaches extreme levels. Such intense euphoria can signal a local top as the good news may be fully priced in.

Bottom Check: XPR key metric returns to neutral

XRP has struggled recently, falling about 21% in the last 20 days. However, an important on-chain metric suggests a change may be coming. The long-term MVRV(chart), which measures the average profit or loss of XRP holders, has returned to the zero line. This indicates that long-term investors are now at their break-even point, which could reduce sell pressure and provide a foundation for a recovery.

• Key Data: XRP's long-term MVRV (365-day) is back at 0%, down from a high of +73% in July.
• Actionable Tip: Use the MVRV metric to gauge long-term holder profitability. A return to the zero line often indicates that a long-term downtrend has exhausted sellers.

Whale Watch: Large BTC holders on an 11 day selling trend, a potentially bearish sign

A look at large Bitcoin holders reveals a cautionary trend. Wallets holding between 10 and 10,000 BTC have been consistently selling over the past 11 days. In that time, they have collectively shed a significant amount of Bitcoin. The behavior of these large "whale" accounts is often seen as a leading indicator.

• Key Data: Bitcoin whales have sold approximately 18,863 BTC in the past 11 days.
• Actionable Tip: Track the holdings of large wallet cohorts. Consistent selling from the most influential players can be a leading indicator of future price weakness.

Metric Watch: BTC 30d MVRV signals potential market low

While large holders are selling, short-term traders are feeling the pain. The 30-day MVRV for Bitcoin is currently in the negative, meaning the average person who bought in the last month is now at a loss. Historically, market bottoms often form when these traders are underwater.

• Key Data: The 30-day MVRV for Bitcoin is at -3.2%, indicating short-term holders are at an average loss.
• Actionable Tip: Consider using short-term MVRV to identify periods of high crowd pain. Negative values, especially below -10%, have historically represented lower-risk entry points.

Pump Warning: Be cautious of movements based on US-China trade deal rumors

The market is buzzing with rumors of a potential trade deal between the US and China, which has fueled some optimistic price action. However, the host issued a warning to be careful. He referenced the classic trading wisdom to "buy the rumor, sell the news." Acting on unconfirmed information is risky.

• Key Data: The market is currently reacting to unconfirmed rumors of a US-China trade deal.
• Actionable Tip: Differentiate between confirmed news and market rumors. Making decisions based on speculation is a high-risk strategy, as rumors can quickly be proven false.

Whale Watch: Large Aether and Layer Zero transfers to exchanges

On-chain data shows that large amounts of altcoins are moving to centralized exchanges(tool), signaling a possible sell off. Significant transactions for Aether, Layer Zero, and Ethena were highlighted. When whales move assets to an exchange, it can imply they are preparing to sell. This activity could be a warning of potential downside pressure.

• Key Data: Two separate whale transactions of Aether, each valued at $2.3 million, were sent to exchanges.
• Actionable Tip: Monitor on-chain exchange inflow data for specific assets. A large spike in coins moving to exchanges can be a warning of an impending sell-off.

Conclusion

This week's crypto market is defined by conflicting signals. Bullish crowd sentiment, driven by the CZ pardon, is clashing with bearish profit-taking from Bitcoin whales. Meanwhile, geopolitical events continue to add a layer of uncertainty.

Understanding these dynamics requires looking beyond price charts. On-chain and social metrics like MVRV and sentiment ratios provide a clearer picture of market health. By analyzing the behavior of different groups—from retail crowds to large whales—we can better understand the forces shaping the market.

To get more data-driven crypto analysis, subscribe to our YouTube channel, our Substack, or follow us on Santiment Insights.