Bitcoin started 2026 with an upward surge, reclaiming the $90,000 mark, but on-chain data shows whale balances and the group of wallets holding 100–1,000 BTC are declining, creating a significant divergence from the optimistic sentiment.
ETF inflows, positive funding rates, and Short sweeps have led many to believe the market has Dip. However, to avoid confusing "smart positioning" with blind optimism, it's necessary to compare it with whale behavior and the actual buying power from Bitcoin ETFs.
- Bitcoin has surpassed $90,000 again after six weeks of consolidation, with signs of buying pressure and liquidation emerging.
- Sentiment is improving (fear & greed are increasing, funding rate is positive), but on-chain data shows that whale balances and wallets with 100–1,000 BTC are decreasing.
- The Bitcoin ETF's AUM has fallen to $67.6 billion, leaving the "market Dip " and the potential for sustainable growth still in doubt.
Bitcoin recovers to $90,000, but the risk of a "Bull Trap" still exists.
BTC resurgence above $90,000 and large Short liquidations are supporting a short-term uptrend, but structural indicators such as whale balances and support from Bitcoin ETFs do not yet show consensus.
Technically, Bitcoin started 2026 with a 2.8% increase, reclaiming the $90,000 level after about six weeks of sideways movement. This reinforces the "Dip has formed" hypothesis, but does not automatically confirm a sustainable uptrend without on-chain confirmation and long-term Capital flows.
From a market position perspective, some traders have clearly benefited. Data from Lookonchain shows one trader who entered a full Longing position with 20x leverage and currently has approximately 55% of their profit unrealized, with an entry point of nearly $87,000.
Simultaneously, on January 2nd, approximately $326 million worth of Short positions were liquidated, described as the largest Short liquidation in a month and coinciding with BTC rise to $90,000. When liquidations increase in this direction, the market often tends to experience a "Short squeeze," causing prices to climb rapidly in the short term.
Market sentiment and funding rates are favoring buyers.
The rising Fear & Greed Index and positive funding rate suggest a return to risk appetite, but without supporting on-chain data, sentiment could quickly reverse.
The key logic lies in the warming sentiment. The Fear & Greed Index increased by 7 points and is close to leaving the "fear" zone. Simultaneously, BTC 's funding rate turned positive, reflecting that Longing positions are willing to pay the fee to maintain their positions, often associated with the expectation of further price increases.
However, as optimism spreads, the market is also vulnerable to a reversal because positions can be “stacked” in one direction. If on-chain data doesn’t confirm the bullish narrative, any dip could trigger a reverse liquidation chain , dragging sentiment back into fear in the short term.
The risk increases as whale activity attracts attention. Some observations of volatility from Bitcoin whales suggest the market is closely monitoring large wallets, as this group can amplify volatility through distribution or accumulation.
on-chain data shows that whale balances and wallets holding 100–1,000 BTC are decreasing.
When excluding exchange addresses, whale balances still tend to trend downward; the 100–1,000 BTC wallet group (including ETFs) is similar, creating a deviation from the “coordinated accumulation” narrative.
Interestingly, when the exchange address is removed from the data sample, the whale's holding balance decreases. This contradicts the expectation that whales are "accumulating" to sustainably drive up prices, as accumulation is usually accompanied by an increase in balance or at least a stabilization over time.
Similarly, the group of addresses holding 100–1,000 BTC (described as including ETFs) also showed the same downward pattern. With both sets of data related to large holdings trending downward, the market needs to be cautious about interpreting price movements as “solid Dip ” based solely on momentum.
Nevertheless, some in the market still refer to this as “ coordinated accumulation .” The problem is that if the actual balance decreases, this interpretation could backfire: the price increase could come from a squeeze and short-term cash flow, rather than structural accumulated buying.
Bitcoin ETFs have yet to find clear support as AUM falls to $67.6 billion.
The decline in Bitcoin ETF AUM to $67.6 billion indicates that ETF Capital are not yet stable enough to Vai as strong "bid support," especially in the context on-chain lacking confirmed accumulation.
The market typically expects Bitcoin ETFs to generate steady demand, but data Chia regarding historical declines shows that AUM has retreated to $67.6 billion, near its lowest level since June 2025. This undermines the argument that ETFs are a solid "pillar" for a rebound.
When ETFs lag behind and whale balances decrease, the "support" for an uptrend becomes thin. In this scenario, a rapid upward move can easily turn into a Bull Trap if buying pressure cannot be sustained after liquidation and FOMO weaken.
Frequently Asked Questions
Does Bitcoin regaining the $90,000 mark mean the market has bottomed Dip ?
Not necessarily. The $90,000 mark and the 2.8% increase in early 2026 are positive signs, but on-chain data shows that whale balances and the group of wallets holding 100–1,000 BTC are decreasing, while support from Bitcoin ETFs is unclear.
Why can a positive funding rate and rising Fear & Greed still be a sign of risk?
Because they reflect sentiment and leverage positioning. When too many positions are skewed towards the Longing side, a sudden drop can trigger a chain liquidation, causing a rapid reversal of sentiment and turning an uptrend into a Bull Trap.
What does the declining whale population indicate?
This suggests that large wallets (excluding exchange addresses) did not increase their holdings as expected during an accumulation phase. If the price increase is primarily driven by a Short squeeze and short-term capital flows, the trend may be less sustainable.
How will the drop in AUM Bitcoin ETF to $67.6 billion affect the trend?
The decrease in AUM indicates that ETF Capital have not yet Vai as a stable buying force. When ETF lagging and on-chain support are not favorable, the market becomes more sensitive to volatility and reversals.
