Wall Street is selling Bitcoin but the old holders are now buying it back

Glassnode's latest Week Onchain report shows that roughly 10.83 million BTC are now in the red, against 9.22 million still in profit.

Loss-making supply now accounts for roughly 54% of the measured total, compared with 46% still in profit, meaning underwater coins exceed profitable coins by about 1.61 million BTC.

Glassnode describes this as one of the sharpest deteriorations in investor profitability since the current bull market began, a threshold with real psychological weight.

Crossing it before has coincided with genuine capitulation among newer buyers, the kind of stress that shapes a structural drawdown.

Underwater holders are the ones most prone to selling into panic or exiting near breakeven once the price recovers, which keeps a layer of resistance above the market.

Yet those same coins can migrate to higher-conviction buyers if patient capital is willing to absorb them, and Glassnode's data shows exactly that kind of buyer has begun to show up.

The seller profile is already changing underneath that stress, as Glassnode says long-term holders have started rebuilding positions, a reversal from an extended stretch of distribution, with net position change back in positive territory.

The pace stays modest, well short of the buying waves seen in prior accumulation cycles, but the direction has turned. The first sign of a bottom often shows up here, in experienced holders deciding a drawdown is worth buying, well before price itself confirms anything.

Glassnode's Accumulation Trend Score climbed across multiple cohorts this week, with the strongest readings among wallets holding less than 1 BTC and entities holding 100 to 1,000 BTC.

Wallets in the 1,000-to-10,000 BTC range also turned net buyers. Bitcoin's quiet bid is spreading across the entire ownership ladder, from the smallest wallets to mid-sized entities.

US-traded spot Bitcoin ETFs remain in sustained net outflow territory, and that selling pressure has persisted even as on-chain conviction builds in the opposite direction. The ETF story explains why the price stays weak, while the on-chain story explains who is taking the other side.

Market layer	Current signal	What it means	Article implication
ETF investors	Sustained net outflows	Regulated wrappers are still de-risking	Explains why price remains weak
Long-term holders	Net position change back in positive territory	Experienced holders are rebuilding exposure	Suggests supply is moving to patient hands
Small wallets	Strong accumulation among sub-1 BTC wallets	Retail-sized holders are buying the drawdown	The bid is not only institutional or whale-driven
Mid-sized entities	Strong buying among 100–1,000 BTC entities	Larger on-chain holders are also absorbing supply	Accumulation is broadening across cohorts
Large wallets	1,000–10,000 BTC wallets turned net buyers	Bigger holders are no longer only distributing	Confirms the seller profile is changing
Spot order books	Coinbase and Binance shifting toward bids	Buyers are placing liquidity below spot	A base can form even while price looks weak

Coinbase and Binance both show books shifting toward the bid, with buyers adding liquidity below spot. That bid looks patient, which is why the price can still look weak even as a base starts to form underneath it.

Hyperliquid traders hold a long bias at the highest level Glassnode has tracked, using leveraged exposure to bet on a bounce before spot conviction is fully confirmed.
The cash market is trying to build a floor, while the derivatives market is trying to get there first.

Options traders are already paying up for protection: the 14-day put-to-call volume ratio climbed above 1.0, its highest reading in a year. Implied volatility is climbing too, up from depressed levels, though Glassnode stops short of calling it a panic reading.

The market carries enough fear to begin bottoming, though the fear needed to confirm a finished capitulation may still be building.

Put together, the pattern looks unusual for a bottoming process, and Bitcoin may be finding a floor through an unusual mechanism: ETF investors are selling while stronger, more patient hands absorb the exit in real time.

Glassnode frames it as an early, still-developing bottoming process and flags that a final capitulation-driven volatility spike stays possible.

Long-term holders buying also trails the scale of prior accumulation waves by a wide margin, keeping the recovery in accumulation fragile.

Bitcoin can probably bottom without ETF inflows returning, as long as outflows slow enough to stop overpowering on-chain accumulation, and the crowded long positioning on Hyperliquid unwinds gradually through price strength.

Scenario	What happens next	Confirmation signal	What it means
Bull case: controlled migration	ETF outflows slow while long-term holders and wallet cohorts keep accumulating	Bid-heavy order books absorb underwater supply; Hyperliquid longs resolve through a bounce	The transfer phase becomes the bottom
Base case: fragile bottoming	Accumulation continues, but ETF outflows and underwater supply keep rallies capped	BTC chops sideways while loss supply stops expanding	Bitcoin builds a base, but recovery stays uneven
Bear case: final capitulation	Crowded Hyperliquid longs get flushed while ETF outflows persist	Implied volatility spikes and underwater holders capitulate lower	Supply still transfers to stronger hands, but through a sharper washout
Failure case: accumulation fades	Long-term holder buying slows and cohort accumulation narrows	Bid-heavy order books disappear; ETF outflows keep dominating	The market was pausing inside a broader drawdown, not bottoming

How this plays out

In the bull case, ETF outflows continue but slow, while long-term holders and broader wallet cohorts continue to accumulate through the summer.

Bid-heavy order books keep absorbing supply from newer, underwater holders, and the aggressive Hyperliquid long positioning resolves through a genuine bounce.

Bitcoin's correction becomes a controlled migration, from ETF sellers and short-term holders into the hands of patient on-chain capital, and the transfer phase becomes the bottom.

In the bear case, the crowded long positioning in Hyperliquid gets flushed, ETF outflows persist, and underwater holders capitulate at lower prices.

Implied volatility spikes toward genuine panic levels, and long-term holder accumulation slows as the drawdown deepens. Bitcoin still ends up transferring to stronger hands, but through one final capitulation event.

Bitcoin's next bottom may begin with an unusual sequence: institutions leaving, weaker holders capitulating, and stronger hands quietly taking the other side. A bottom starts as a turnover in who owns the supply, well before it shows up in price.

The post appeared first on CryptoSlate.

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