Bitcoin price recovered above $85,000 following a period of reduced exposure among smaller holders. On-chain data from Santiment showed that 62,335 wallets holding between 0.1 and 1 BTC disappeared during the July-August market weakness, alongside 7,159 wallets holding 1 to 10 BTC before Bitcoin reclaimed $80,000.
The reduction in smaller holder wallets points to capitulation rather than fresh retail accumulation. While wallet changes do not definitively prove every address sold its coins—some holders may have consolidated balances or transferred funds—the timing correlates with the market shakeout. Fearful holders who sold into weakness no longer control those coins, potentially shifting supply to buyers, custodians, exchanges, or larger wallets.
The Bitcoin price move above $85,000 triggered significant liquidations. Exchanges recorded approximately $648 million in bearish crypto position closures during the breakout. These short liquidations can accelerate gains as exchanges buy assets to settle collateral.
Options Leverage Rebuilding
Glassnode reported that options leverage was rebuilding as Bitcoin touched $86,000. Open interest put-call ratios increased, showing greater activity around upside and downside protection. However, perpetual futures funding remained below neutral levels, indicating traders had not rebuilt aggressive long exposure across perpetual contracts.
The current recovery appears less driven by one-sided leverage compared to previous rallies. Options leverage remained below the extremes observed near the prior market top.
Next Resistance Levels
Bitcoin price now faces the $88,000 to $92,000 zone as the next major hurdle. A sustained move above that range would strengthen the longer-term market structure. Failure to clear it could expose the breakout to profit-taking and another test of lower support.
Technical analysis linked to the current setup identifies a possible move above $100,000 later this year if Bitcoin clears the range, contingent on continued demand, stable derivatives positioning, and adequate liquidity. Traders are monitoring whether wallet counts begin to stabilize as the market approaches the $88,000 to $92,000 band.
