Crypto & Forex April 2, 2026 0 Comments

Is Bitcoin on the Brink? The Hidden Supply Crisis Signaling a Steep Slide Before the Next Bull Run

Bitcoin has been on a rather rough ride since October 2025 — dropping nearly half its value from a staggering $126K high. If you asked me six months ago whether this was a bear market, I might’ve squinted and hedged a bit, but now? There’s no denying it. What’s genuinely intriguing, though, is how much of the coin remains tightly held by the big players — about 68% still locked up by large and mid-sized investors, as Axel Adler Jr. uncovered. That’s a hefty chunk not yet ready to throw in the towel. Meanwhile, everyday holders are feeling the pinch, with short-term losses prompting swift sell-offs at break-even points — remember Bitcoin’s spiking up to $76K resistance, only to be knocked back down? It’s like a trader’s nightmare sequel. So here’s my question: How long before these concentrated holdings start to shift and shake the market dynamic to its core? Are we on the cusp of a broader sell-off, or is this just the calm before the storm? Dive deeper into these Bitcoin supply shifts and what they mean for the crypto landscape ahead. LEARN MORE

Bitcoin [BTC] has been on a bearish trend since October 2025. Since its all-time high of $126K, BTC has shed 46% of its value in just under six months. That it has been a bear market is under no doubt anymore.

What was in contention, however, was the extent of the distribution phase. In fact, crypto analyst Axel Adler Jr. recently found that large and mid-sized Bitcoin investors still hold around 68% of the BTC supply.

The short-term holder drawdown has been high, and any price bounce is likely to be met by aggressive profit-taking and exiting at breakeven. This has already happened once, with the rejection from the $76K resistance.

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Bitcoin holdings rebalance not yet underway

Bitcoin Balance Share by Cohort — Source: Axel Adler Jr Insights

Cohorts whose balances ranged from 100 to 10K BTC were categorised by size. Their share of the supply holdings came to 68%, while small participants holding 10 BTC or fewer had only 17% of the supply.

Distribution from large and mid-sized investors and a rebalance in Bitcoin holdings among cohorts lower down the scale are needed to trigger a structural change. This would point towards a broader distribution and a capitulation regime.

Bitcoin UTXO Profit Count Percent — Source: CryptoQuant

Another factor that pointed towards a deeper reset was the UTXO Profit Count Percent. The metric measures the number of individual unspent transaction outputs (UTXOs) that are worth more today than at the value they were last moved.

The 30-day and 365-day moving averages of this metric were at 69.1% and 87.5%, respectively. This underlined weakness, but not a full market reset. For context, the previous cycle’s 1-year moving average hit 55.7%.

In May 2019, the metric’s yearly average declined to 63.8%, both of which were quite far from 87.5%. There is stress in the market right now. And, by the 365-day moving averages’ standards, there may be more room for a full structural reset.

When can the market bottom be expected?

Bitcoin Bull Market Comparison — Source: Joao Wedson on X

Founder and CEO of crypto intelligence platform, Joao Wedson, used post-halving bull market durations and the historical bottoms to estimate the current cycle’s bottom.

The chart showed that the bottom could come 912-922 days from the most recent halving event. This puts the estimated cycle bottom at late September- early October 2026.

Final Summary

Large and mid-sized investors hold 68% of the Bitcoin supply, meaning a broader capitulation can be expected in the next six months.
Based on previous cycles, the current bear market bottom could come around October 2026.