Bitcoin Whales Distribute Assets as Price Drops 20%

Bitcoin's whale activity has surged, with the Exchange Whale Ratio (EWR) exceeding 0.6, indicating increased large-holder activity on exchanges. This metric, which reflects the top-10 exchange inflows, has been climbing since the fourth quarter of 2024. Historically, when the EWR surpasses this threshold, large holders tend to distribute their assets, potentially signaling forthcoming selling pressure in the market.

Bitcoin reached an all-time high of $106,128 on December 17, 2024. Since then, the asset has entered a correction phase, sliding by approximately 20% to $84,619 as of March 23, 2025. This pullback aligns with notable spikes in the EWR, particularly in late 2024 and March 2025. During Bitcoin’s climb from $55,000 to over $100,000, the EWR rose while the price rallied, suggesting early profit-taking by whales.

Exchange netflows have shifted from bullish outflows to signs of redistribution. Between April and October 2024, monthly outflows typically ranged from 30,000 to 60,000 BTC. However, this trend began to change in the fourth quarter of 2024. For instance, on November 24, 2024, net inflows surged to +7,033 BTC as Bitcoin neared $68,000, indicating early movers were realizing profits. On December 17, 2024, the day of Bitcoin’s all-time high, netflow showed a withdrawal of 1,531 BTC, smaller compared to previous accumulation phases.

In the post-peak period, netflows became volatile. While not outright bearish, moderate netflows combined with a high EWR suggest whales are still transferring coins to exchanges, albeit at a reduced scale. The Net Unrealized Profit/Loss (NUPL) ratio, which measures unrealized gains within the network, climbed from 0.442 to 0.627 between August and December 2024, reflecting widespread profits and fueling Bitcoin’s rally. By March 2025, NUPL declined to 0.480, surpassing a 21% price drop with a 23.4% decrease. This suggests the market remains profitable but has entered a phase of realization, with whales and long-term holders among those realizing gains.

Despite the pullback, the NUPL continues to hover above bearish territory, signaling that the market remains profitable overall. Whales are shifting assets, profit-taking is underway, and volatility persists. Yet, with NUPL in profit and netflows stabilizing, the market appears to be holding its ground—cautiously balanced between distribution and resilience. The current situation suggests a pause rather than a pivot, with the market awaiting further developments before making significant moves.