Bitcoin Faces Resistance as Large Holders Prepare to Sell

The surge in bitcoin's price towards $75,000 is encountering significant resistance due to a surge in supply, even as institutional demand remains steady. The recent price increase has been driven primarily by macroeconomic factors rather than speculative activities, with US-listed spot bitcoin ETFs attracting consistent inflows. This includes a single session that saw roughly $240 million in inflows following geopolitical tensions in the Middle East, as reported by market maker Enflux. This influx of funds helped push BTC from around $71,000 to the mid-$70,000s, despite rising oil prices and shifting interest rate expectations in traditional markets. According to Enflux, this pattern reflects allocation behavior rather than investors chasing momentum. However, as bitcoin's price continues to rise, the market's dynamics are beginning to shift. On-chain data suggests that supply is emerging more aggressively as prices approach a key cost-basis level for short-term holders, around $76,800, which is the average entry point for traders who accumulated during the last phase of the drawdown, according to CryptoQuant. Historically, this level has acted as resistance in weaker market regimes, as investors who were previously underwater use rallies to exit at breakeven. Notably, this same level capped the bounce in January before prices reversed towards $60,000. CryptoQuant noted that bitcoin exchange inflows spiked to approximately 11,000 BTC per hour, the highest since late December, as prices tested the $75,000 to $76,000 range. At the same time, the average deposit size increased to about 2.25 BTC, the highest daily reading since mid-2024, indicating that larger holders are driving the move. The share of large transfers jumped from below 10% to above 40% of total inflows within days, a shift that the firm said has historically coincided with increased distribution pressure. This sets up a two-sided market, with ETF flows and macro tailwinds providing a steady source of demand on one side, and large holders appearing to use the rally to reduce exposure on the other, feeding liquidity into the market as prices approach a widely watched breakeven zone. The result is less a standoff than a handoff, with long-term holders distributing coins directly into ETF demand. Whether this handoff clears depends on whether the new holders prove stickier than the ones exiting, a late-cycle pattern that resolves in one of two ways. The outcome is a market that can move higher quickly on inflows but struggles to sustain those gains once supply builds. A sustained break above the mid-$70,000s would likely require demand to absorb a growing wave of sell pressure. Failing that, the balance could tilt the other way, leaving bitcoin vulnerable to a pullback toward the low-$70,000s, where the latest leg of the rally began.