After the last price slump that followed the USA-China escalating trade war, Bitcoin’s prolonged consolidation phase may be approaching its final act.
A new report from 10x Research suggests that the cryptocurrency’s muted volatility is the result of a delicate balance between whale accumulation and mega whale distribution – a dynamic that has kept prices anchored near $110,000 but won’t last forever.
Supply Pressure Meets Fading Demand
According to 10x Research, Bitcoin’s trajectory is increasingly shaped not by macroeconomic cycles or interest rate speculation, but by real-time capital flows – how much new money enters the market versus how much exits. The firm argues that this flow-based model explains Bitcoin’s stagnation over the past few months better than traditional cycle theories.
Two forces are currently defining Bitcoin’s price behavior. On one side, Digital Asset Treasury companies such as MicroStrategy have largely exhausted their buying capacity. On the other, legacy wallets – some dormant for years – have been quietly unloading large amounts of BTC, often into the same institutional demand generated by spot ETFs.
This balance between inflows and outflows has kept Bitcoin in a state of equilibrium, limiting both upside rallies and downside collapses.
Treasury Buyers Step Back
Earlier this year, 10x Research anticipated that the passage of the U.S. GENIUS Act and subsequent political developments would temporarily boost sentiment among corporate treasuries holding Bitcoin. However, as the legislative momentum faded over the summer, so did the liquidity that fueled Bitcoin’s earlier gains.
The firm’s July and August publications warned that companies like MicroStrategy would face a “natural cap” on their Bitcoin accumulation as their net asset value (NAV) premiums compressed. That prediction has now come true: MicroStrategy’s NAV multiple has fallen to just 1.2x, signaling that investors are no longer pricing in aggressive future purchases.
Instead of the billion-dollar buys that once set the tone for the market, MicroStrategy has reduced its purchases to tens of millions – a scale too small to drive meaningful new demand.
Legacy Wallets Cash Out
At the same time, long-time holders have been taking profits, offloading billions in Bitcoin as ETF inflows absorb the supply. 10x Research first identified this pattern in mid-2025, noting that these legacy wallets were distributing BTC in measured amounts – enough to prevent a price collapse but sufficient to suppress volatility.
The latest Glassnode data visualized by 10x Research shows this interplay clearly: while whale addresses (typically those holding between 1,000 and 10,000 BTC) continue to accumulate, mega whales (wallets exceeding 10,000 BTC) have been distributing their holdings at a nearly equivalent rate. The result is a market stuck in consolidation, with volatility at multi-year lows.
A Profitable Strategy – For Now
This stable range has made volatility-selling one of the most profitable strategies in recent months. Traders betting against large swings have benefited from the predictable sideways action. Yet, as 10x Research warns, this phase is unlikely to persist indefinitely.
“Periods of tight consolidation like this are rarely permanent,” the report noted. “Once one side – either demand or supply – breaks, volatility will return swiftly.”
The firm emphasizes that while mega whales are still offloading, the scale of selling has already started to moderate. If ETF inflows and institutional allocations continue to hold steady, Bitcoin could regain upward momentum once this overhang clears.
Bitcoin’s Open Interest Drop Signals Healthier Conditions
Recent data from Glassnode adds another layer to this stabilization narrative. The firm reported that Bitcoin’s futures open interest has fallen by roughly 30%, signaling that excess leverage has been flushed out of the system. With funding rates now close to neutral, the market appears far less vulnerable to another large-scale liquidation cascade.
#Bitcoin open interest has dropped by ~30%, flushing excess leverage from the market. With funding now near neutral, the market is far less vulnerable to another liquidation cascade.
🔗https://t.co/4M02uALnGX pic.twitter.com/l4hkNnZdZX
— glassnode (@glassnode) October 21, 2025
This cleansing of speculative positions supports 10x Research’s view that volatility could remain subdued in the short term before a decisive move emerges.
Bitcoin Price Outlook
Bitcoin is currently trading near $109,300, stabilizing after a volatile session that wiped out over $96 million in leveraged positions during the past 24 hours. Data shows that long positions accounted for nearly $72 million of those losses, suggesting that traders betting on a rebound were caught off guard by the latest pullback.
Despite the shakeout, Bitcoin has managed to hold above the $108,000 – $109,000 support zone, signaling that buyers are still defending key levels.
From a technical perspective, resistance remains firm around $115,000, while a decisive break below $105,000 could expose the market to further downside pressure. However, with liquidation data indicating that excess leverage has already been flushed out, analysts expect volatility to subside in the short term.
A renewed push above $111,000 could open the door for a broader recovery toward the mid-$120,000 region, especially if whale accumulation continues to strengthen.
The Road Ahead
For now, Bitcoin remains caught between forces of accumulation and distribution. Whales are quietly adding, while mega whales and legacy wallets continue trimming exposure. 10x Research believes this standoff could resolve within the coming months, as reduced selling pressure coincides with renewed capital inflows.
Traders watching Bitcoin’s next move should focus less on macro headlines and more on wallet-level behavior. When the balance between whale buying and mega-whale selling finally tips, Bitcoin’s consolidation could give way to a decisive breakout – one that will likely define the next phase of the market cycle.
