Bitcoin News Today: Bitcoin Faces Prolonged Sell-Off as Long-Term Holders Offload Holdings

Long-term Bitcoin holders are increasingly selling their assets, raising concerns among analysts that this could lead to a months-long market correction. On August 1, 2025, a decade-old Bitcoin wallet holding over 300 BTC was emptied, coinciding with a price dip to a three-week low. This movement was part of a broader trend of whale activity, with Galaxy Digital reportedly selling 80,000 BTC valued at $9 billion on behalf of a client. CryptoQuant has identified this as the third major whale sell-off of 2024, signaling potential prolonged downward pressure on Bitcoin’s price [1].

Whale selling increases the supply of Bitcoin on exchanges, which can drive volatility and exacerbate price declines. For instance, a dormant address recently transferred $4.7 billion worth of Bitcoin to Galaxy Digital, which then proceeded with the large-scale sale. Analysts warn that such movements are not just isolated events but rather part of a larger pattern that could signal a broader correction [2].

The market reaction has been swift and severe. On the day of the large-scale sales, Bitcoin broke below its two-week consolidation range, reaching a new local low. The Advanced Sentiment Index also reflected bearish conditions, reinforcing fears of a prolonged downturn. Traders are now watching closely to see if Bitcoin can reestablish support above the $115,724 level or if further declines are imminent [3].

On-chain analytics reveal that the majority of selling activity is coming from major holders rather than short-term traders. According to AInvest, institutional investors and miners are also taking profits, shifting the dynamics of the market. This marks a departure from earlier patterns, where short-term holders were the primary drivers of price declines [4].

COINOTAG notes that over 85% of on-chain spending in recent weeks has come from new buyers, many of whom are inexperienced and prone to panic selling during downturns. This influx of speculative capital has contributed to exaggerated price swings, with new investors often amplifying bearish sentiment during periods of volatility [5].

The dominance of new participants has been highlighted as both a sign of growing interest in Bitcoin and a source of instability. In contrast, long-term holders—who typically act as stabilizing forces in the market—have become net sellers, raising red flags among analysts. Historically, these holders have been less reactive to short-term price fluctuations, but their recent behavior suggests a shift in sentiment [1].

Despite the immediate challenges, some analysts remain cautiously optimistic. Mitrade suggests that the current selling wave may represent a phase of energy consolidation rather than a full-blown bear market. For this to be the case, key support levels must hold, and buying pressure must reemerge from long-term holders and institutional investors [2]. However, the continued dominance of speculative activity from short-term traders complicates this outlook.

With over $629 million in liquidations reported on August 1, 2025, strategic risk management has become essential. Investors are advised to monitor on-chain metrics such as wallet age and transaction volume to better understand market dynamics. Real-time analytics tools from platforms like COINOTAG and Glassnode are increasingly vital in tracking these trends and predicting potential turning points [10].

The current phase of Bitcoin’s market is being shaped by a combination of profit-taking from long-term holders and speculative trading from new entrants. While the immediate outlook remains uncertain, the broader implications of this shift in holder behavior could signal a transition in market dynamics. Analysts are divided on whether this is the beginning of a correction or a temporary consolidation, but the coming months will be critical in determining Bitcoin’s next major price direction [4].

Source:

[1] Glassnode Report: Bitcoin Sell-Off Driven by Short-Term Holders with 85% On-Chain Spending from New Buyers (https://en.coinotag.com/breakingnews/glassnode-report-bitcoin-sell-off-driven-by-short-term-holders-with-85-on-chain-spending-from-new-buyers/)

[2] Mitrade: Bitcoin's Next Big Surge? On-Chain Metrics Suggest a ... (https://www.mitrade.com/insights/news/live-news/article-3-1003254-20250801)

[3] Blockchain News: BTC Price Drop Forces $400 Million Position Liquidation (https://blockchain.news/flashnews/btc-price-drop-forces-400-million-position-liquidation-for-aguilatrades-key-trading-insights)

[4] AInvest: Bitcoin Faces Extended Sell-Off as Whales Miners ... (https://www.ainvest.com/news/bitcoin-news-today-bitcoin-faces-extended-sell-whales-miners-lths-offload-holdings-2508/)

[5] CryptoSlate: Short-term Holders Drove Bitcoin Price Decline But Market ... (https://cryptoslate.com/insights/short-term-holders-drove-bitcoin-price-decline-but-market-remains-profitable/)

[10] The: Polkadot's DOT Drops Over 5% Amid Market Selloff (https://m.economictimes.com/crypto-news-today-live-01-aug-2025/liveblog/123028555.cms)