On-chain data suggests that this positioning may not be too far-fetched. According to CryptoQuant, profit taking has just hit a 2026 high, while traders’ unrealized profits are climbing to 33%.
Meanwhile, Bitcoin’s Spot-Futures divergence continues to widen, pointing to rising speculative activity.
However, Santiment’s latest data sheds some light on why the setup could help Bitcoin.
As can be seen in the chart above, Bitcoin’s large shareholder category is once again in accumulation mode. Wallets holding between 10 and 10,000 $BTC coins increased their holdings by 41,025 $BTC over the past ten days, bringing the total amount to 13.64 million, or 67.93%.
In other words, the big players continue to buy.
Taken together, rising profit-taking and renewed whale accumulation suggests a textbook STH to LTH transition. In other words, $BTC’s sideways consolidation around $85k may be less about weakness and more about supply shifting into stronger hands.
If that trend continues, it could support a move toward $90k for Bitcoin in early Q4, in line with the bullish positioning building in the options market.
Bitcoin’s $90k setup faces a liquidity test
The market is sending a clear signal: Bitcoin’s correction is a liquidity story.
In other words, for Bitcoin to fall below 83,000, together with higher Treasury yields, a stronger dollar, higher oil prices, and renewed geopolitical tensions, is signaling tighter financial conditions and less liquidity in the market.
Why is this important? Utkarsh Ahuja, Founder and Managing Partner at Moon Pursuit Capital, explained to AMBCrypto:
If the investor can earn more than 5% on a 10-year US Treasury, riskier assets have to compensate him for taking on additional risks. The same calculation applies across portfolios.
He continued,
The investors should ask themselves if they are paid enough for the risks that they take, because compared to the yields of safer assets, the weak balance sheets, excessive leverage and speculative valuations become very hard to justify.
In layman’s terms, higher yields increase the appeal of safer assets, which tends to suppress riskier assets such as Bitcoin, particularly when liquidity is already tight and leverage across the board is expanding.
With that said, the recent jobs report could act as a bullish catalyst, adding some credibility to Bitcoin’s potential $90k+ breakout. But there’s a catch.
With liquidity already being a concern, spot demand still weak, and speculative activity rising, can tokenization alone provide enough liquidity ‘momentum’ to the crypto market to continue its upward trajectory?
The RWA boom is bullish for DeFi, but there’s a catch
Oftentimes, the market views DeFi growth as a bullish catalyst for Bitcoin.
Tokenization plays an important role in it. The RWA sector reached over $38 billion in on-chain assets, with millions of holders in tokenized markets. The growth is being driven by tokenized Treasuries and others.
As the chart below shows, U.S. tokenized Treasury funds are set to close Q3 with total assets hitting a record $16 billion. The steady rise shows that demand for tokenized yield products is picking up.
With the demand for U.S. Treasuries also rising, it could create a stronger liquidity bridge between TradFi and crypto.
However, Ahuja warned that the trend should be looked at separately from Bitcoin’s short-term price movement.
Beyond the immediate market I am watching institutional tokenisation because it operates on a completely different timeline to daily crypto prices.
Notably,
Bitcoin can sell off while the infrastructure supporting digital assets continues to advance, and investors need to separate those two realities.
In essence, the market does not see higher tokenized treasury yields and increased TradFi inflows into DeFi as a bullish catalyst for Bitcoin.
The reason is simply that this liquidity is not large enough to offset the rising speculative positioning, thus keeping the overall liquidity test around Bitcoin [$BTC] intact.
Could Bitcoin repeat its post-midterm crash pattern?
Given the setup above and the historical trends, a mid-Q4 crash cannot be ignored.
Bitcoin appears to be in a textbook accumulation phase with STHs slowly sliding into LTH holders. However, history adds a risk factor. The U.S. midterm elections are just one month away, and $BTC’s performance following the previous midterms is difficult to dismiss.
Following the 2010, 2014, 2018, and 2022 elections, Bitcoin ultimately fell 72%, 65%, 52%, and 27%, respectively. So the question that arises is, could $BTC repeat this pattern? Notably, the current setup keeps the risk factor on the table.
The reasoning is sound: Bitcoin supply is consolidating with bigger and bigger holders, fresh buyers are sidelined, macro FUD is getting louder, and liquidity is still constrained.
Given these historical patterns, a sell-off from these large holders could quickly trigger a deeper correction.
With limited fresh liquidity coming in, there may not be enough Spot demand to absorb the selling pressure, leaving $BTC vulnerable to a sharp downside move.
Hence, with the midterms approaching, a retest of the $73k level cannot be ruled out if a liquidity unwind triggers cascading pressure across the futures and options markets.
Final Summary
- Whale accumulation supports a move toward $90k, but weak demand and tight liquidity remain risks.
- As the midterms approach, a liquidity squeeze could push Bitcoin toward $73k.
