Bitcoin’s latest price slump has pressured short-term investors, many of whom have rushed to cut their losses.
Cointelegraph reveals that more than 20,000 BTC held by short-term holders (STHs) have been sold as the crypto asset continues its bearish price movement.
This comes as the market started the new week with a continuous downward movement, which saw more than $500 million in long positions wiped out amid rising macroeconomic concerns and renewed uncertainty around U.S monetary policy.
Recall that the price of Bitcoin last week hit a new record high of 124,496 before retracing to the $114,000 price zone. The selloff triggered a wave of forced liquidations, as 133,643 traders were wiped out in the past 24 hours, totaling $576.35 million, according to Coin Metrics. That included $123 million in bitcoin liquidations and $178 million in ether liquidations, as traders were forced to sell assets at market prices to cover leveraged positions.
A recent report by CryptoQuant reveals that BTC held by short-term holders (STHs), i.e, investors who typically own Bitcoin for less than 155 days, flowed to exchanges at a loss over the past three days. Transfers surged from 1,670 BTC on Sunday to 23,520 BTC by Tuesday, coinciding with a 3.5% price dip from $118,600 to $114,400, Glassnode data showed.
The trend highlights a recurring behavioral pattern of panic-selling by short-term speculators during pullbacks, while long-term holders (LTHs) remain relatively steady, accounting for just 10% of exchange inflows. CryptoQuant analyst Kripto Mevsimi noted that for the first time since January, a period marked by the sharpest correction of this cycle, short-term investors are realizing losses again, with STH-SOPR multiples dipping below.
Historically, this has signaled two possibilities: either weakening momentum that precedes deeper corrections, or a “healthy reset” that flushes out weak hands, paving the way for more sustainable rallies, he noted.
Market sentiment remains divided. Trading firm Swissblock cautioned that a break below the $100K–$110K support zone which has held firm for over 100 days would open the door for sub-$100,000 levels. Bitcoin analyst AlphaBTC warned that a close below $114,700 could drag BTC toward the $110,000–$112,000 demand zone.
On prediction market Polymarket, traders are leaning bearish. Odds for Bitcoin closing at $114,000 stand at 73%, with a 39% chance of dipping below $112,000 and an 18% and 16% probability for moves toward $110,000 and $108,000, respectively.
Notably, short-term Bitcoin holders may be selling due to uncertainty surrounding U.S. Federal Reserve Chair Jerome Powell’s upcoming Jackson Hole speech, scheduled for August 21-23, 2025.
Reports suggest STHs are booking profits amid fears that Powell’s speech could dampen risk appetite. Bitcoin’s implied volatility is near two-year lows, indicating market complacency, but some warn of downside risks if Powell signals prolonged high rates or addresses tariff-driven inflation concerns.
It is understood that Powell’s 2022 Jackson Hole speech triggered swift Bitcoin price corrections, raising concerns about similar volatility this time. However, some crypto experts highlight optimism, noting Bitcoin’s historical 18% average gain 30 days post-dovish Fed pivots in summer periods.
As BTC goes through its recent correction, this event will be pivotal for the future outlook of the cycle. If the bulls manage to absorb the wave of selloffs quickly, it could lead to a rapid rebound, if not, there is a risk of further bearish price action.
An analyst from CryptoQuant offers a glimpse of a potential turnaround, with Bitcoin’s exchange netflow (the difference between the amount of BTC leaving and entering exchanges) becoming more negative, from -1.7K to -3.4K BTC/day.
This means that the asset is being bought faster than it is sold on CEXs, hinting at traders buying the dip, preparing for a potential leg up.
