Glassnode: Bitcoin Rally Hindered by Holder Activity

Glassnode notes a reduction in Bitcoin's illiquid supply, impacting market dynamics.

Analysts at Glassnode have observed a reduction in Bitcoin’s illiquid supply. Since mid-October, long-term investors have withdrawn approximately 62,000 BTC from their wallets.

Illiquid $BTC supply has started to decline, with roughly 62,000 BTC moving out of long-term, inactive wallets since mid-October. When illiquid supply falls, more coins are available to trade, which can make it harder for price to trend without strong new demand. pic.twitter.com/lyh2R7EtUB

— glassnode (@glassnode) October 25, 2025

Experts believe that the increase in market supply could impede the asset’s price rally in the absence of strong demand.

Previously, illiquid supply was a fundamental pillar of the current market cycle, but the latest correction has somewhat altered the situation. Analysts noted that such pullbacks have historically weakened market momentum.

They also recalled larger outflows in the past, such as 400,000 BTC in January 2024.

Illiquid supply has been a major tailwind this cycle, but the latest pullback breaks that trend. Similar declines have historically cooled momentum as supply returns to market, and we’ve seen far bigger outflows before, like the 400K BTC in Jan ‘24. pic.twitter.com/StJCwmu1JX

— glassnode (@glassnode) October 25, 2025

Investor Group Activity

Over the past 30 days, whales have been accumulating assets, according to Glassnode.

Whale Activity
What’s interesting is that whale wallets have actually been accumulating during this phase. Over the last 30 days, whale wallets have grown their holdings, and since October 15th, they haven’t largely sold their positions. pic.twitter.com/L8TaEh2wch

— glassnode (@glassnode) October 25, 2025

The main outflow of coins has been recorded from wallets with balances ranging from 0.1 BTC to 10 BTC. Holders of these addresses have been selling assets since November 2024.

Researchers believe that most “momentum” buyers have exited the market. Investors buying the dips have been unable to offset the increased supply.

According to Glassnode, this imbalance will continue to pressure Bitcoin’s price until demand recovers in the spot market.

Bull Market Signal

The price of digital gold has returned above the short-term holders’ cost basis (STH-Cost Basis). Analysts at Checkonchain view this as a constructive signal for a bull market.

Bitcoin has just reclaimed the Short Term Holder Cost Basis level. Short-lived undercuts of this important level are expected and constructive for the longevity of a bull market (weak hands get flushed out).

What we don’t want to see is this level becoming resistance. If it… pic.twitter.com/58riv10rXc

— _Checkonchain (@_checkonchain) October 26, 2025

Experts consider brief dips below this mark to be expected and healthy. They say such movements “flush out” weak hands from the market.

“An undesirable scenario is for this level to become a resistance zone. In such a case, the risk of the market transitioning into a prolonged bear trend increases,” emphasized Checkonchain.

Bitcoin Breaks Above $115,500

Analyst Axel Adler Jr. pointed to the $115,500 level as crucial for the leading cryptocurrency. In his view, a breakout and sustained move above this mark would confirm the continuation of the upward momentum.

While the market is testing $115.5K, a breakout and sustained move above this range would signal a continuation of the upward momentum. pic.twitter.com/BapveR6jeA

— Axel 💎🙌 Adler Jr (@AxelAdlerJr) October 27, 2025

Adler also noted a new price gap on the Chicago Mercantile Exchange that formed over the weekend. He pointed out that over long horizons, most gaps close due to Bitcoin’s high volatility and its tendency to revisit previous levels.

Over long horizons, many gaps do get filled simply because Bitcoin is volatile and often revisits previous levels. There’s no magic or 100% accurate signal in it it’s mostly a visual pattern that many traders watch, which sometimes becomes self-fulfilling.

— Axel 💎🙌 Adler Jr (@AxelAdlerJr) October 27, 2025

“There’s no magic or 100% accurate signal in it. It’s mostly a visual pattern that many traders watch, which sometimes becomes self-fulfilling,” explained the analyst.

As reported by CryptoQuant, specialists noted that the high concentration of the leading cryptocurrency in “dolphin” addresses (100-1000 BTC) makes their activity a key factor in determining market direction in the late stages of a bull phase.