Bitcoin Stalls as Whales Retreat — Retail Traders Drive Choppy

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Whale inactivity has left retail traders in control of price action.
Exchange outflows mostly reflect ETF custody shifts, not a supply crunch.
STHs show caution, but the larger bull trend remains intact.

Bitcoin (BTC) appears stuck in neutral as major whale activity cools off, leaving retail traders to dominate short-term price action. While on-chain metrics hint at supply tightening and rising caution among short-term holders (STHs), the broader bull cycle still shows signs of strength—suggesting this may be just a pause, not a peak.

Whales Exit, Retail Drives Choppy Price Action

Between early April and late May, both large and mid-sized whale wallets completed their major repositioning. They either sold into strength or shifted holdings while liquidity was high. Since then, whale activity has thinned, leaving retail traders to drive market moves.

The result has been predictable: sideways, choppy action filled with sharp squeezes and fakeouts. Historically, whales tend to return when Bitcoin approaches strong support levels or when a new market trend is about to begin. Until that happens, BTC is likely to remain range-bound—though their reentry could spark the next major breakout.

Exchange Outflows Don’t Mean a Supply Shock

Recent sharp declines in exchange reserves have sparked talk of a looming supply crunch. However, much of this BTC hasn’t left the market entirely—it’s simply being moved from centralized exchanges to ETF custodians.

Once ETF balances are factored back in, the net circulating supply hasn’t changed significantly. Without fresh inflows into spot Bitcoin ETFs, these custodial shifts are unlikely to fuel any immediate price rally.

STHs Show Caution, But Trend Still Intact

STHs have begun selling at a loss again, as indicated by SOPR dipping below 1 after months of profitability. While this could appear bearish, it reflects mild profit-taking rather than panic.

Also Read: Bitcoin ETFs Score $642M, Ether ETFs $405M as Wall Street Roars Back

Unlike prior retail-driven bubbles, Bitcoin’s rise from $60K to $125K has occurred with minimal retail participation—hinting that institutional capital has been driving the uptrend. If key support holds and SOPR rebounds above 1, the long-term bullish structure likely remains intact

With whales on the sidelines and retail calling the shots, Bitcoin’s sideways drift looks more like a breather than a breakdown. Until whales or ETFs return with strong buying power, volatility will stay contained—but when they do, the next big move could arrive fast.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.