Bitcoin: Exploring BTC's Path to $100K – A Focus on Leverage Over Demand

Bitcoin's recent market behavior has shown a strong reliance on leverage rather than direct demand from buyers. An aggressive short squeeze has driven up prices, and while older holders (OGs) are selling less, the overall market dynamics suggest that Bitcoin's journey towards the $100,000 mark could be precarious if not supported by genuine market demand.

Key Takeaways

Leverage is playing a crucial role in Bitcoin’s price momentum.
The recent short squeeze marked the largest liquidation event since October 2025.
OG Bitcoin holders are selling less, indicating possible conviction among long-term investors.
Whales are hedging their positions, while retail traders are entering longs, creating potential market instability.
The sustainability of Bitcoin's price increase will depend on the transition from leverage-driven momentum to demand-based growth.

Bitcoin sees whales hedge as OG's selling slows -What comes next?

The Role of Leverage in Bitcoin's Momentum

Leverage has quickly emerged as a key factor influencing Bitcoin's [BTC] recent momentum. A significant price breakout led to a substantial short squeeze, compelling traders to unwind their bearish positions rapidly. According to data from Glassnode, this event represented the most considerable short liquidation across the top 500 cryptocurrencies since October 10, 2025. The graph clearly shows that spikes in liquidations closely follow Bitcoin's upward movement.

Bitcoin liquidation spikes
Source: Glassnode

As traders lost millions in short positions within a brief period, the need for buybacks pushed prices even higher, creating upward pressure. This scenario has been developing since late 2025, and its intensity has increased as Bitcoin maintained its elevated levels instead of retracing. Should liquidations continue, Bitcoin could potentially reach the $100,000-$105,000 range driven by momentum alone. Conversely, if funding cools and open interest resets, the price may stabilize. Historically, the sustainability of such price movements has depended on genuine demand replacing leverage-driven trends.

Changing Behavior Among OG Bitcoin Holders

Older Bitcoin (OG) holders are now selling less frequently compared to earlier in the current cycle. Data from STXO shows a noticeable decline in spending among long-term holders who have not moved their coins for over five years. Additionally, insights from CryptoQuant indicate that OG holders had been quite active in early 2024, utilizing institutional demand and government purchases as favorable exit points. However, this trend has changed significantly, with spending peaking around 3,800 BTC and gradually decreasing to 3,200 BTC and then further to 2,200 BTC.

OG Bitcoin Holder Spending
Source: X

In the short term, a reduction in selling by OGs decreases the overhead supply and aids in maintaining price stability. In the long term, this shift suggests a potential increase in conviction among these investors. Historically, OGs tend to limit their distributions during accumulation phases rather than towards the end of market cycles.

Market Dynamics: Whales vs. Retail Traders

The market demonstrates a notable divergence, where whales are taking measured steps by unwinding long positions and shifting towards short ones. This strategic repositioning indicates a cautious approach. Meanwhile, the price remains high, despite waning momentum, and leverage appears to be gradually increasing.

These factors create a heightened risk scenario. Whales often act preemptively, recognizing crowded positions and late-cycle behaviors. In parallel, OG Bitcoin holders have also reduced their selling, which minimizes genuine selling pressure.

Whale Activity
Source: X

On the other hand, retail traders tend to react opposite to market trends. They often chase upward momentum rather than following established structures, increasing their long positions, particularly as volatility rises. On-chain data from Alphractal revealed that while whales were closing their long positions and switching to shorts, retail traders were heavily engaging in leveraged longs.

Following this strategy, Bitcoin experienced a nearly 20% decline, from $69,000 to $56,000, before stabilizing. This setup hints at a possible market shakeout or cooling phase. If leverage unwinds, the price could face a retracement prior to any sustainable recovery.

Overall, Bitcoin's current structure indicates that momentum is primarily driven by leverage rather than real market demand. The short liquidations have pushed the price higher, while OG selling has slowed, and whales take a more defensive stance. This balance tightens supply but also increases market fragility, meaning that any future upside could be exposed to risks. For Bitcoin to achieve sustainable growth, it requires genuine market demand to replace reliance on leverage. Until that occurs, the volatility risk remains elevated.

Final Thoughts

Bitcoin's journey remains uncertain as market dynamics shift. Understanding the interplay between leverage, OG selling behaviors, and whale activity is essential for assessing potential future movements in the cryptocurrency market.