Source: Cointelegraph Original: "{title}"
Since Bitcoin's price reached a weekly high of $88,752 on March 24, it has formed a series of lower highs and lows on the 1-hour timeframe.
As the week comes to a close, Bitcoin's price has failed to break through the $88,000 resistance, reducing the likelihood of testing $90,000 before the end of the first quarter.
Bitcoin 1-hour chart. Source: Cointelegraph/TradingView
Why has Bitcoin been unable to break through the $90,000 barrier?
One major reason for the current pressure on Bitcoin's price is the selling pressure from short-term holders (STH) — investors who have held their coins for less than 155 days — who continue to sell. Glassnode noted in its latest "On-Chain Weekly" report that this Bitcoin cycle exhibits characteristics of "high-level concentrated holdings," with many investors who bought at higher price levels currently holding a significant amount of Bitcoin supply. This has made the short-term holder group the main group experiencing the largest price decline since Bitcoin pulled back 30% from its all-time high.
Glassnode analysts emphasized in the report: "The loss position of short-term holders has surged to 3.4 million Bitcoins, the largest loss position for short-term holders since July 2018."
Total supply loss held by short-term holders. Source: Glassnode
The selling pressure faced by short-term holders is reflected in Bitcoin's accumulation trend score.
Bitcoin's accumulation trend score is an indicator that quantifies selling pressure. Since the BTC price dropped from $108,000 to the $93,000-$97,000 range, this score has remained below 0.1. A score below 0.5 indicates that the market is in a distribution (selling) phase, while a score below 0.1 suggests severe selling pressure.
Another reason Bitcoin struggles to break through $90,000 is the contraction of the liquidity environment. Data shows that on-chain transfer transaction volume has dropped to $5.2 billion daily, a significant decrease of 47% compared to the peak when Bitcoin hit its all-time high. Meanwhile, the number of active addresses has also decreased by 18%, from 950,000 in November 2024 to 780,000.
At the same time, open interest (OI) in the Bitcoin futures market has fallen 24% from $71.85 billion to $54.65 billion, and the funding rate for perpetual contracts has also cooled down.
This deleveraging and liquidity contraction, combined with only 2.5% of the total supply being in profit during the correction period, makes it difficult for the market to break through the $90,000 barrier — as there are not enough buy orders in the market to absorb the sell orders.
New demand for Bitcoin continues to decline
Glassnode data shows that the current Bitcoin bull market cycle lacks new demand (buyers) entering the market. The cost basis distribution (CBD) heatmap indicates that supply is concentrated at higher price levels ($100,000 to $108,000), but there is a lack of sufficient new buyers in the lower price range to support a price rebound.
Bitcoin frenzy zone, top buyer cost basis. Source: Glassnode
Insufficient demand factors are exacerbated by macroeconomic uncertainty
Macroeconomic uncertainty further weakens demand, hindering new investors from entering the market. This trend is reflected in the changes in capital flows — when the cost basis of short-term holders from 1 week to 1 month is lower than that of 1 month to 3 months, the market experiences a net capital outflow.
However, Glassnode analysts state: "On the other hand, the long-term holder (LTH) group still holds a significant portion of network wealth, currently holding nearly 40% of the invested value."
Essentially, this long-term accumulation phase may ultimately tighten supply and create more favorable conditions for new demand once the market establishes a stronger upward trend.
Related: Bitcoin price prediction market forecasts that Bitcoin will not exceed $138,000 by 2025
This article does not contain investment advice or recommendations. All investment and trading activities involve risks, and readers should conduct their own research before making decisions.
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