Binance Research reports that a combination of on-chain indicators points to a tightening Bitcoin supply and diminishing sell pressure, with exchange balances falling to a six-year low. Approximately 500,000 BTC have left trading venues since the COVID-era peak.
In a thread published May 17, Binance argued that four key metrics now align: long-term holders dominate, speculative activity is subdued, exchange supply has decreased, and short-term holders are just beginning to rebuild unrealized profits. The firm says this suggests the market has shifted away from forced selling toward a more supply-constrained structure.
"Four on-chain signals point to the same conclusion: supply is tightening and sell pressure is exhausted," Binance Research wrote.
The first signal is supply dormancy. Nearly 60% of BTC has not moved in over a year, compared to 27% in 2012. Dormant supply peaked at 69.5% in January 2024, the same month U.S. spot Bitcoin ETFs were approved. Binance Research notes that despite the subsequent sell-the-news reaction, dormancy remains elevated, indicating strong long-term holder conviction.
The second metric is the SLRV ratio, which compares short-term and long-term coin activity. This indicator remains deep in its historical bottom zone, signaling market apathy rather than overheated speculation. Binance Research says long-term holders dominate supply while short-term speculators have largely exited, a condition historically associated with cycle bottoms.
The third signal is exchange balances. Bitcoin held on exchanges has fallen from 17.6% of supply during the COVID peak to 15.0% today, representing roughly 500,000 BTC leaving exchanges-cutting available sell-side supply to a six-year low. This reduces liquidity readily available for sale.
The fourth indicator involves short-term holder profitability. BTC STH MVRV has moved back above 1.0 after remaining below that threshold since November 2024, meaning short-term holders are again sitting on unrealized gains but still in early accumulation stages. Binance Research says this historically precedes sustained recoveries, with a new wave of selling pressure unlikely to materialize imminently.
At press time, BTC traded at $76,761.
