Experienced Bitcoin traders, often referred to as "OGs," are showing renewed bullish positioning despite the market undergoing a significant deleveraging phase. CryptoQuant founder and CEO Ki Young Ju highlighted this shift in an August 13 thread on X, noting that veteran participants are accumulating long positions similar to their behavior during the 2023 cycle bottom near $16,000.

The current market dynamic contrasts with previous cycles where exchange traders served as primary exit liquidity. In this cycle, structural demand from spot ETFs and digital asset trusts (DATs) absorbed significant supply, pushing unrealized profits among Binance traders to nearly three times the levels seen at the 2021 market top. However, these gains fueled substantial leverage buildup, which is now being flushed from the system.

Leverage Metrics and Market Structure

Ju pointed to the ratio of BTC/USDT futures open interest relative to USDT exchange reserves as a key gauge of market leverage. This ratio climbed above 0.5 at its peak before declining toward 0.3 as leverage was reduced. Despite this decline, leverage remains above pre-ETF levels, a structural change Ju does not expect to be fully reversed.

Ju stated that if spot Bitcoin ETF inflows strengthen again, futures leverage is expected to rise alongside them. This combination of institutional spot demand and aggressive derivatives positioning could create conditions for larger price swings.

What the Numbers Show

The data reveals a divergence between historical profit realization and current leverage normalization. While unrealized profits for Binance traders reached levels nearly three times those of the 2021 top due to ETF-driven demand, the subsequent price correction has brought Bitcoin back toward the average cost basis of these traders. This suggests that the recent price stability is driven by the absorption of leverage rather than a lack of selling pressure, with veteran traders now stepping in to provide support through increased taker buying volume on platforms like OKX.

Bitcoin (CRYPTO: BTC) spot trading volume has declined to its lowest level since 2019, reflecting a market where sellers are tiring but buyers remain absent. The asset is currently confined to a tight trading range between $63,000 and $68,700.

Glassnode analyst Frederik Theissen noted in the firm's weekly on-chain report that Bitcoin failed to react significantly to July core CPI data of 2.5% or record-high equity levels. This lack of response suggests a distinct absence of demand despite a benign macroeconomic backdrop.

Price Support and Resistance Levels

The asset is pinned between two key cost-basis levels. The Median Realized Price at $63,000 has acted as support, absorbing tests from above for more than a month. Overhead resistance sits at the Short-Term Holder Cost Basis of $68,700, representing the average entry price for recent buyers who are currently underwater.

Price has remained within this pocket for nearly three months as these two levels converge. Reclaiming $68,700 would return recent buyers to profit, while a break below $63,000 would leave little structural support before the June lows.

Market Dynamics: Sellers vs Buyers

Seller pressure appears to be waning, with the Seller Exhaustion Constant at a cycle low among the weakest readings since 2013. The Spend Output Profit Ratio (SOPR), which tracks whether coins move at a profit or loss, has tested breakeven nine times since October but failed each time.

Conversely, buying interest remains weak. ETF inflows turned slightly positive at the end of July but represent only a fraction of prior accumulation waves. Exchange inflows continue to rise, indicating building sell-side supply without sufficient institutional demand to absorb it.

What the Numbers Show

A significant divergence exists between spot market activity and derivatives positioning. While spot participation has dried up, futures open interest has grown to exceed an entire day of futures volume, nearing last September's record. Derivatives traders on Hyperliquid have been net long every day since mid-March, a historic streak for the platform. This buildup of leverage occurs alongside shrinking resting bids, which have fallen by roughly a third since July, reducing the buying interest available to cushion any downward move toward the June low near $58,500.