A growing split between large and small Bitcoin holders may indicate the market’s recent downturn has not yet run its course. Historically, this type of divergence has often appeared before additional price weakness. At the same time, sentiment across the crypto market has deteriorated, with the Crypto Fear and Greed Index sliding to 12 over the weekend, deep within “extreme fear” territory.

On-chain data from analytics platform Santiment shows that large investors—commonly referred to as whales—stepped in to buy during last week’s sharp sell-off. Wallets holding between 10 and 10,000 BTC accumulated substantial amounts between Feb. 23 and March 3, when bitcoin traded in a range of roughly $62,900 to $69,600.

That buying period coincided with the market turbulence linked to geopolitical tensions involving Iran, as well as the early phase of the recovery that followed. However, when bitcoin climbed to around $74,000 on Thursday, those same whale wallets began to reduce their positions. Since then, they have sold about two-thirds of the bitcoin they purchased during the dip.

Smaller investors, meanwhile, have been moving in the opposite direction. Wallets holding less than 0.01 BTC continued accumulating as bitcoin slipped back below $70,000 heading into the weekend. Santiment noted that this pattern—retail buyers stepping in while large holders distribute coins—has historically served as a warning signal that a correction may not yet be complete.

Further data from blockchain analytics firm Glassnode highlights additional pressure within the market. Around 43% of bitcoin’s circulating supply is currently sitting at a loss. As prices rise, many of those investors may use rallies as opportunities to exit positions near their entry points rather than hold through continued volatility.

That dynamic appeared to play out when bitcoin’s rebound stalled around the $74,000 mark. The rally encountered heavy selling from both profit-taking whales and investors looking to break even after weeks or months of unrealized losses.

The broader market picture reflects significant volatility without sustained directional progress. Bitcoin traded near $60,000 on Feb. 6 before rising to roughly $74,000 on March 5. Yet the cryptocurrency is now hovering near $68,000—close to the level it occupied several weeks earlier.

Such price action illustrates a market caught in a tug-of-war. Each upward move attracts sellers eager to exit positions, while dips draw in retail traders hoping to capture a rebound.

Eventually, the market will likely resolve this stalemate in one of two ways. Either the supply from underwater holders is gradually absorbed, allowing bitcoin to break decisively above $74,000, or buying demand weakens, opening the door for a deeper test of support near $60,000.

Recent activity from whales suggests that many large holders may be positioning for the latter scenario.