Bitcoin Positions for Gains as Sell-Side Liquidity Dries Up

What Comes Next For The Bitcoin Market in 2025

As the new year emerges, it is once again apparent that Bitcoin (BTC) will be due for a trading correction in the first quarter for the reasons once again. However, as indicators such as the liquidity on the selling site continue to decline, there is a scope for profit in the mid term.

Data from the Alpha Report Let’s Us Synthesize The Following

If we are to utilize the data from the Bitfinex Alpha report, it can be concluded that the largest correction for the market in Q1 2025 that was anticipated is likely to be much chiller now after the volatility seen during the Bitcoin fall mid December. Blockchain liquidity is also experiencing a deflation, so BTC may be lucky in post-COVID quarters.

Bitcoin sell side liquidity market correction

A recent report has gone viral that states that on the selling end Bitcoin liquidity has been running dry and reaching all time low, this has more than a month since it last been at such levels however the progression we stand at is depleting.

In October 2024, it was about 41 months that the ratio pointed, and at the moment the said number is roughly at 6.6 months. The market activities collective with the lowered sell side liquidity during the rally sessions of the Bitcoin in the early and late sessions of 2024 showcase a swift upward movement.

Miner Behavior

An analyst associated with Bitfinex has pointed out that the BTC miners have played a significant role in the decrease in liquid selling energy. In the past, during halving years, it was observed that miners tend to bail out due to the excessive machinery purchase pressure halving awards provide during the years.

However, since the beginning of April 2024, miners have ceased liquidating any BTC. Moreover, the decline in the net amount of assets transferred to exchanges, which started to grow at the beginning of 2025, also indicates a decrease in selling activity.

HODLing Trend

In November 2024, together with the rally of BTC after the US presidential elections, miners started transferring more BTC to exchanges. However, to some extent, they stopped selling their coins in order to maximize their profit.

At this point, the BTC miners are witnessing profitability which leads to holding of the coins instead of moving them to sell. The Net Unrealized Profit and Loss (NUPL) for the miners has yet to reach the level of zero which indicates that there is a large expected loss and miners’ preference is to sell BTC.

Long-term Holders

Apart from the miners, long-term holders too have started holding out on selling their BTC, this has further encouraged the decrease in liquidative selling energy.

From these observations, it can be see that in the medium term, the estimates for Bitcoin are favorable owing to the combined emerging HODLing behaviors of miners and longer-term holders and the diminishment liquidity from selling, even with minor deviations expected in the short term.