Bitcoin’s latest pullback triggered a wave of forced liquidations across the cryptocurrency market, while onchain data revealed mounting selling pressure from newer investors who transferred thousands of BTC to exchanges at a loss.
Bitcoin (BTC) dropped to $80,350 on Bitstamp before recovering to around $82,500 on Friday. According to CoinGlass data, total cryptocurrency liquidations reached approximately $1.09 billion over the 24 hours leading up to 10 am UTC on Friday, with long positions accounting for roughly $1.05 billion of the total.
The liquidation surge marked the largest daily total since Aug. 21, when a Bitcoin rally from $73,000 to $79,500 triggered approximately $1.3 billion in short-position liquidations.
Bitcoin’s $82,500 support level comes under pressure
The decline followed reports that the US government had transferred more than 12,000 BTC previously seized by authorities, raising concerns about potential selling pressure.
Bitcoin’s retreat also put a closely watched technical level back in focus. The $82,500 area had served as a breakout point during the cryptocurrency’s broader uptrend since early July and was central to an inverse head-and-shoulders pattern that traders had interpreted as a potential bullish reversal.
Market analyst Rekt Capital warned that Bitcoin’s ability to reclaim and maintain this level would be critical. In a post on X on Thursday, the analyst said a weekly close below approximately $82,500 could turn the former support into resistance and push Bitcoin back into its broader accumulation range.
Such a development would weaken the bullish reversal scenario, leaving traders watching the weekly candle close for further confirmation of the market’s direction.
Short-term investors transfer 55,600 BTC at a loss
Onchain activity provided another indication of growing pressure on Bitcoin holders. CryptoQuant contributor Amr Taha reported that short-term holders transferred approximately 55,600 BTC to exchanges at a loss on Thursday.
The category generally includes entities holding Bitcoin for up to six months. Transfers at a loss indicate that coins are being moved to exchanges at prices below those associated with their previous transactions, potentially signaling that investors are preparing to sell after prices decline.
CryptoQuant noted that the volume exceeded a comparable reading on June 26, when Bitcoin fell below $60,000 for a second consecutive day. At the time of Thursday’s transfers, BTC was trading above $81,000, more than 36% higher than the roughly $59,300 price recorded in June.
However, transferring Bitcoin to an exchange does not necessarily mean that all the coins will be sold. Some investors may move assets for other purposes, making exchange inflows an indicator of potential selling pressure rather than definitive evidence of completed sales.
Could selling pressure precede a recovery?
Heavy loss-taking by short-term holders can signal capitulation, a phase in which less resilient market participants exit their positions amid fears of further declines. In some historical cases, this behavior has helped reduce selling pressure and preceded a recovery.
That outcome is not guaranteed. If Bitcoin fails to regain the $82,500 level and selling continues, the market could face further downside pressure. Conversely, a sustained recovery above that threshold could help restore confidence in the bullish technical setup.
For now, traders are monitoring Bitcoin’s weekly close, exchange flows and liquidation activity for signs of whether the latest sell-off represents a deeper correction or a potential capitulation phase.
