Glassnode: The reduction in BTC holdings by "Diamond Hand" has put greater resistance to price increases. The current bottom-fishing funds have failed to generate sufficient demand to absorb the selling pressure.

Glassnode posted on social media that illiquid Bitcoin supply has begun to decline, with approximately 62,000 BTC transferred out of long-dormant wallets since mid-October. When illiquid supply decreases, more tokens enter circulation. Without strong new demand, upward price trends face greater resistance. Illiquid supply has been a significant driver of this cycle, but the recent reversal has disrupted this trend. Historically, similar supply reversals have weakened market momentum—a larger outflow of 400,000 BTC occurred in January 2024. While the current change is relatively mild, the trend is noteworthy. Interestingly, whale wallets have continued to increase their holdings during this period. Whale holdings have steadily increased over the past 30 days, with no significant sell-offs since October 15th. The largest and most consistent outflows have primarily come from wallets holding 0.1-10 BTC (approximately $10,000 to $1 million). This group has been consistently net sellers since November 2024. Momentum traders have largely exited the market, while bargain hunting funds have failed to generate sufficient demand to absorb the selling pressure. As first-time buyers remain on the sidelines, this supply-demand imbalance will continue to suppress prices until stronger spot demand emerges.