He described signs of exhaustion among sellers and cited technical work suggesting a bottom could appear soon.
The Short-Term Holder Spent Output Profit Ratio fell below 1 on multiple occasions, which signals many short-term owners sold at a loss. XWIN also said coins younger than three months made up most of the spent volume during the worst of the drop.
That pattern points to panic-driven exits by recent buyers rather than mass, late-cycle distribution by longtime holders.
At the same time, metrics such as Coin Days Destroyed, Realized Profit, and Long-Term Holder Net Position Change registered increased distribution by long-term holders since September, but XWIN argued this behavior matches routine profit-taking during a bull run rather than blow-off top selling.
Reports have disclosed that exchange-traded fund outflows and large sales by whales also contributed to the weakness, while rising geopolitical tensions added a further layer of risk.
Market participants described Bitcoin as an early mover that started to weaken before other risk assets, which some investors took as a warning signal for broader markets.
Lee expects a rebound if equities rally later this year, saying a stronger stock market would likely lift Bitcoin back to fresh highs before year-end.
Hougan agreed that a recovery could come quickly and that the current window offers an attractive entry for investors planning to hold for 12 months or more.
Yet traders remain split; a few see the recent data as clear exhaustion, while others warn macro events and policy decisions could push prices lower before confidence returns.
Featured image from Unsplash, chart from TradingView
