Bitcoin Drops 7% From All-Time High Amid Stablecoin Outflows

Bitcoin (BTC) has recently retreated from its all-time high of $111,814, currently trading in the mid-$100,000 range. This retreat has sparked concerns about the cryptocurrency's momentum, as several on-chain indicators suggest a potential shift in market dynamics.

One of the most notable indicators is the significant outflow of stablecoins from Binance, amounting to over $1 billion. This movement suggests that traders are transferring funds off the exchange and into private wallets, which is often a sign of reduced risk appetite or a diminished intent to buy crypto in the near term. Such large-scale stablecoin withdrawals can indicate declining buying power and may precede a loss of market momentum or a shift toward profit-taking and caution. If this trend continues, BTC could slip further, potentially losing the psychologically important $100,000 level.

In addition to stablecoin outflows, long-term holders (LTHs) have also shown signs of pulling back. The Net Position Realized Cap for LTHs dropped from $28 billion to just $2 billion by the end of May 2025, indicating that these investors are not increasing their exposure despite the recent price surge. This reduction in LTH participation further supports the idea that the market may be experiencing a shift in sentiment.

Furthermore, 60-day wallet behavior trends reveal a divergence in market sentiment. Large holders with 1,000 to 10,000 BTC have been gradually offloading their positions, while smaller retail cohorts holding 100 to 1,000 BTC have been aggressively accumulating, buying into the rally. This divergence suggests a market in transition, where institutional investors may be taking profits while retail buyers continue to drive the price upward.

The combination of heavy stablecoin withdrawals, reduced LTH accumulation, and shifting cohort behaviors signals a market in transition. Whether this sets the stage for a cooling-off period, a healthy consolidation, or renewed momentum will depend on how new capital re-enters the system and whether retail buyers can sustain the current rally without institutional reinforcement.

Despite these warning signs, other on-chain data suggests that BTC may continue its upward trajectory. The Bitcoin Net Realized Profit/Loss (NRPL) metric supports a continued upward trajectory, with current profit-taking levels being modest compared to previous cycle peaks. Additionally, BTC outflows from centralized exchanges are increasing, with a recent withdrawal of 7,883 BTC from Coinbase. This could indicate renewed institutional interest and accumulation in anticipation of another upward move.

At press time, BTC trades at $103,854, down 0.2% in the past 24 hours. The future direction of Bitcoin will depend on how these conflicting signals play out in the coming weeks and months. Investors and traders will need to closely monitor these on-chain indicators to gauge the market's next move.