⚠️ Structural crisis in BTC
On the attached screenshot you can see the current heatmap of BTC distribution - large clusters of previously purchased coins by price zones. Let's quickly run through them:
1) The $60,000-72,000 zone. This is what stopped the dump on Feb 6, bouncing off its lower boundary (meaning the cluster boundary, not the previous range). This cluster was built over nearly a year, from February to November 2024. Early-cycle large buyers were defending their positions here, averaging their entry price with all types of orders. Plus, profit-taking kicked in from both pure short sellers and external hedges (the whales essentially added to their buys using profits from hedge shorts)
2) This is the next nearest strong zone, $40,000-45,000, which lines up with the lower bound of my projected bear market bottom. Between these two zones there are virtually no major order blocks, so in a negative stress scenario, that entire distance could be covered pretty fast. However, keep in mind this is the extreme case - there's still an intermediate defense at the average realized purchase price across all participant cohorts (which is already the boundary of massive market-wide capitulation), currently sitting at $55,000, a level that long-term holders love to defend by any means necessary (and now BlackRock has joined the defenders)
3) And here we have the upper clusters. Both are large. I have 2 pieces of news:
• First, the good news. The first major cluster starts around $84,000, which is the potential boundary of the next bounce. From current levels that's potentially another 22-24% move up. BUT - on the first attempt buyers didn't even have enough strength to break through the intermediate price block, with an upper boundary from that same range back in Feb-March 2024 (71-73K)
• Second, the bad news. This is the real, existing volume of underwater BTC. And as we can see on the map, it's much denser than all the lower clusters. If price keeps dropping, the nerves of holders trapped above could crack, and that entire volume would avalanche into the market, amplifying sell pressure. The volume of trapped money in the $84-117K zone is colossal - nothing like it in dollar terms has existed before (in BTC terms there's been more), and this avalanche will only hit the market on a very strong catalyst (for example, another major exchange going bankrupt, like FTX)
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🔷 So, what conclusions can we draw:
1) Buyers are weak, the 71-73K level has become resistance, but at the same time clear support has appeared below - the nearest major cluster with its boundary at $60,000. Price action in the $60,000-72,000 range currently looks most probable. Probability of this scenario (in my view) = 60-70%. Liquidity will accumulate in this corridor, building up strength for a break of resistance... or support
2) A break of resistance at $72,000 sends price to the nearest upper cluster at 83-85K, which would almost certainly stop the rally and give the market time to figure out the next direction. Probability = 15-25%
3) A break below $60,000 takes price to $54,000-55,000, which becomes the bottom. Or, some extremely sharp negative catalyst hits crypto (like another bankruptcy), and both upper clusters dump into the market, price flies as close to $40K as possible... Lowest probability = 5-15% (but not off the table)
#onchain@mr_mozart_en
