By Key Points
- Bitcoin Q1 2025 Crash Sparks Bullish Signals from Whales
- Bitcoin fell 11.82% in Q1 2025, its worst quarterly loss since 2018
- U.S. tariffs and macroeconomic concerns drove prices down
- Whale wallets holding 1K–10K BTC rose 2.6% in five weeks
- Exchange supply drops to lowest level since Feb 2018
Bitcoin (BTC) just wrapped up its worst Q1 performance in seven years, falling 11.82% in the first quarter of 2025. Starting the year near $106,000, Bitcoin slid to just over $80,000 by late March, wiping out significant gains from Q1 2024 where BTC had surged 68%.
Bitcoin Price Performance. Source: Coinglass – Techtoken
This sharp downturn is largely attributed to macroeconomic pressures and renewed uncertainty sparked by U.S. President Donald Trump’s tariff policies, which have already had ripple effects across the crypto mining sector. Trump’s stance on Bitcoin mining is being closely watched by industry stakeholders, as regulation could either boost or hinder future adoption.
But despite the red charts, there’s a lot happening under the surface that could flip the narrative sooner than expected.
Bitcoin whale wallets continue growing in number. Source: Santiment – Techoken
Whale Accumulation Signals Growing Confidence
One of the most compelling bullish signals? Whales are buying the dip.
On-chain analytics platform Santiment reported that the number of wallets holding between 1,000 to 10,000 BTC rose by 2.6% in just five weeks, hitting 1,993 wallets as of March 31—the highest since December 2024.
Whales typically signal smart money moves. Their growing accumulation hints at long-term confidence in Bitcoin’s trajectory, despite recent volatility.
Spending from 3m–6m $BTC holders is at the lowest levels since mid-2021. This inactivity reinforces the idea that recent top buyers are holding their positions rather than exiting, despite recent volatility. pic.twitter.com/cS4bPa4bWo
— glassnode (@glassnode) March 31, 2025
Meanwhile, data from Glassnode reveals that trading activity among short-to-mid-term holders (those holding for 3–6 months) has hit its lowest point since June 2021. That signals a decrease in selling pressure—these holders are not exiting, they’re holding.
Less activity from short-term holders means less panic-selling. That alone gives Bitcoin more breathing room to stabilize or bounce back.
Bitcoin’s supply on exchanges. Source: Santiment – Techtoken
Low Exchange Supply Hints at Imminent Scarcity
Another key metric pointing to a bullish setup is the declining supply of Bitcoin on exchanges.
As of March 31, BTC held on centralized exchanges has dropped to 7.53%, its lowest since February 2018, according to Santiment. This means that more users are moving their BTC into cold storage, a classic signal of long-term holding behavior.
This reduced exchange supply creates a supply crunch scenario. If demand rises again—whether due to macroeconomic shifts, ETF inflows, or institutional interest—Bitcoin’s price could surge rapidly due to simple supply-demand dynamics.
Analyst Axel Adler Jr. believes the selling pressure is “exhausted.” In an April 1 post on X, he noted that BTC is likely entering a consolidation phase in April and May, potentially setting up for a breakout.
The average selling pressure on top exchanges has dropped from 81K to 29K BTC per day.
Welcome to the zone of asymmetric demand.
The market has successfully absorbed waves of profit-taking following the break above $100K.
Sellers have dried up, and buyers seem comfortable with… pic.twitter.com/mgzrCacMMq— Axel 💎🙌 Adler Jr (@AxelAdlerJr) April 1, 2025
This perspective is backed by Fidelity Research, which sees Bitcoin progressing into the next “acceleration phase” of its growth cycle. Fidelity highlights that accumulation and sideways price movement typically precede large upward moves—especially when institutional demand and Bitcoin’s reputation as an inflation hedge grow.
Institutional Signals and Legislative Moves Add Fuel
Beyond the charts and wallets, institutional activity and regulatory developments are also painting a bullish long-term picture.
A recent proposal in California, the Bitcoin Rights Bill, is grabbing attention. If passed, it could impact 39 million residents by formally recognizing and protecting Bitcoin usage at the state level. This would be a huge win for adoption, potentially leading other states to follow.
At the same time, the broader market saw turbulence from a $14B quarterly options expiry, which caused short-term volatility but also helped reset market positions. Analysts believe this “shake-out” could clear the path for more stable movement in Q2.
Meanwhile, some major players like Coinbase reported struggles, with the exchange seeing its worst quarter since the FTX collapse. Although this might seem like bearish news, it actually highlights the market bottoming sentiment—where capitulation often marks the start of a recovery cycle.
And yes, the crypto community had its fair share of distractions. CZ’s April Fools’ burn address prank sparked a flurry of speculation but also showed the strength of the community’s engagement—even in bearish conditions.
All signs are pointing toward a market that’s cooling down short-term, but heating up beneath the surface.
While Bitcoin’s Q1 2025 performance might look grim, savvy investors are watching what really matters—whale behavior, exchange supply, and legislative signals. If history is any guide, this dip might just be the calm before the next major breakout.
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