Bitcoin Could Slip Lower Without Fresh Catalyst as Long-Term Holders Take Profits, Glassnode Says

• Bitcoin correction risk

• Glassnode reports long-term holder supply down ~300,000 BTC since July, signaling profit-taking.

• Over $19 billion in liquidations and negative ETF flows (~2,300 BTC) heighten short-term downside risk.

Bitcoin correction: Glassnode warns momentum is fading — read analysis and next steps from COINOTAG.

By COINOTAG | Published: 2025-10-16 | Updated: 2025-10-16

What is causing the Bitcoin correction?

Bitcoin correction is currently being driven by a mix of profit-taking from long-term holders, negative net spot ETF flows, and heightened macroeconomic uncertainty tied to renewed tariff tensions. Glassnode’s on-chain data shows large liquidations and shrinking LTH supply that collectively reduce upward pressure.

How are ETF flows affecting Bitcoin momentum?

Spot ETF inflows have become a key demand signal. According to Glassnode, cumulative spot Bitcoin ETF net flows turned negative by roughly 2,300 BTC this week, representing one of the most notable slowdowns since mid-year. Reduced ETF demand removes a reliable buyer class that supported earlier rallies and can increase price fragility in the event of market shocks.

Over the past 24 hours Bitcoin moved from $116,000 toward $110,000 amid heavy volatility. On exchanges, trading dynamics shifted: Glassnode’s spot volume charts show BTC reserves on trading platforms reached about $1.5 billion — one of the highest levels since April — indicating elevated available supply relative to demand.

Bitcoin’s upward momentum close to exhaustion, Glassnode predicts

Glassnode’s Wednesday report highlights that Bitcoin has slipped below the 0.95-quantile level near $117,100 three times since late August. That band represents roughly 5% of supply, primarily held by top buyers. When price moves below this quantile, historically it has preceded extended mid- to long-term corrections, per Glassnode’s historical observations.

Market-wide liquidations intensified after a sudden sell-off tied to renewed tariff rhetoric from US political developments. The same period saw >$19 billion in total liquidations across derivatives markets, with more than 1.6 million traders impacted, according to Glassnode’s aggregation of exchange data and liquidation metrics. Such forced exits amplify downside moves and can unsettle retail participation.

Profit-taking among long-term holders

Glassnode’s long-term holder (LTH) supply metric indicates seasoned investors have reduced exposure by roughly 300,000 BTC since July. This distribution reduces the pool of HODL capital that historically supports recoveries, meaning fresh capital — institutional or retail — must step in to absorb realized supply. In the absence of renewed inflows, price consolidation or deeper corrections become more probable.

Institutional behavior appears bifurcated by venue: Glassnode’s Cumulative Volume Delta Bias shows pronounced taker-side sell pressure on Binance, while Coinbase reflected net buying, suggesting US-based and institutional investors were more accumulative. These venue-level contrasts can mask broader market indecision.

Technical commentators (Crypto VIP Signal) note a triangle pattern with $109,000 as a near-term support level; breach of that threshold could trigger further liquidation cascades and a return to panic selling. These technical setups combined with on-chain signals create a higher-probability path toward deeper weakness unless a catalyst emerges.

BTC spot ETF flow chart. Source: Glassnode.

Market structure and liquidity indicators

Exchange-level liquidity and reserves climbed after the large liquidation event, implying traders moved assets onto platforms to trade or exit positions. Glassnode data shows spot exchange reserves near $1.5 billion. Historically, elevated exchange reserves correlate with increased selling capacity and can add downward pressure if sentiment flips.

Open interest and funding-rate dynamics also tightened after the crash, signaling reduced leverage appetite. This deleveraging protects the broader market from immediate re-leveraging risk but also removes a potential amplifier for upside moves.

Frequently Asked Questions

Will Bitcoin fall below $100,000 in the current correction?

There is no certainty, but current indicators — negative spot ETF flows (~2,300 BTC), long-term holder supply reductions (~300,000 BTC), and elevated exchange reserves (~$1.5B) — increase the probability of deeper downside if no new demand catalyst appears. Monitor support near $109k–$110k.

How should I ask about Bitcoin’s short-term outlook?

Ask in natural language: “Is Bitcoin likely to drop more this week?” Experts recommend tracking on-chain metrics (Glassnode), ETF flow updates, and exchange reserves to assess short-term pressure and potential reversal triggers.

Key Takeaways

• Momentum fatigue: Bitcoin’s rally shows signs of exhaustion, with repeated slips below the 0.95-quantile near $117,100 limiting upside.
• Distribution: Long-term holders reduced supply by ~300,000 BTC since July, indicating profit-taking that can cap rallies.
• Demand shortfall: Negative net spot ETF flows (~2,300 BTC) and elevated exchange reserves (~$1.5B) point to demand-side fragility; a fresh catalyst is needed to restore momentum.

Conclusion

This COINOTAG analysis finds that the primary drivers of the current Bitcoin correction are profit-taking among long-term holders, a pullback in spot ETF demand, and elevated on-exchange supply following large liquidations. Official on-chain analytics (Glassnode) and exchange data (Binance, Coinbase, Bitstamp) provide the factual basis. Market participants should watch ETF flows, exchange reserves, and the $109k–$117k range for signs of stabilization or further downside. For traders and investors, prepare risk management plans and monitor confirmed flow and liquidity signals for decisive next steps.