The truth behind the crash: whales had premeditated, retail investors became the 'bag holders'
In the past 24 hours, Bitcoin has free-fallen from a high of $118K to $113K. However, this crash was not accidental; whales had quietly offloaded above $118K while retail investors were still frantically chasing the 'dream of $118K'.
According to the latest report from the on-chain data monitoring platform CryptoQuant, from July 31 to August 1, Bitcoin whale addresses cumulatively sold over 23,000 BTC, worth about $2.7 billion. These fund flows indicate that whales had locked in profits long before the price broke $118K, while retail investors rushed in amid the frenzy of 'bull market return' on social media.
Ironically, although the Fear and Greed Index remains at 66, the proportion of retail holdings has surged to 78%—this indicates that market dominance has completely shifted from institutions to retail investors, and historical experience shows that markets dominated by retail often experience extreme volatility.
II. The 111K Lifeline: Rebound or Crash?
The current BTC price is struggling around $113K, but the technical indicators have issued danger signals:
The MACD histogram continues to be negative and is lengthening, indicating that bearish forces are crushing the bulls;
The KDJ indicator is showing a death cross, the RSI value has fallen below 30, the market has entered the oversold zone, but no rebound signs are present;
The key support level of $113.5K has been breached, and the next line of defense points directly to $111K—if this level is broken, technical analysts will collectively turn bearish, triggering a chain sell-off.
Top traders warn in their latest analysis: 'If BTC falls below $112K, the market structure will completely turn bearish, and any rebound will just be a 'bloody bait'.' Another viewpoint believes that if it can stabilize above $111K, it may replicate the 'V-shaped reversal' of July 11, when BTC plummeted from $115K to $113K and then rose to $117K within 24 hours.
But the reality is that current trading volume has shrunk by over 30% compared to previous days, with the market quiet, and both bulls and bears are on the sidelines—this is precisely the calm before the storm.
III. Where have the whales gone? Altcoins become the 'scapegoat'
Behind the retreat of whales is a dramatic shift in the flow of funds in the crypto market:
BTC's market share continues to decline, dropping from 52% at the beginning of July to 48%, indicating that funds are flowing from BTC to altcoins;
ETH leads the mainstream coins, benefiting from rising demand for stablecoins and RWA deployment, with ETH price hovering around $3797, up 0.96% in 24 hours;
SOL and its related coins are becoming new favorites, trader Vivian predicts: 'If BTC consolidates, SOL and other Layer 1 public chains may rise next.'
But the problem is that the rise of altcoins completely depends on the stability of BTC. If BTC falls below $111K, altcoins will face a 'waterfall' sell-off, and the market will replay the tragic scene of 'BTC crash → altcoins go to zero' in 2024.
IV. What should retail investors do? A survival guide is here!
Do not catch the 'falling knife': if BTC falls below $111K, immediately cut losses, do not attempt to bottom fish—bottoms are not guessed, they are fallen to;
Focus on the game in the $111K-$113K range: if it can stabilize in this range, a small long position may be tried, but the stop loss must be set below $110.5K;
Stay away from high-leverage contracts: current market volatility is soaring, and leveraged traders are at high risk of liquidation, while spot holders are safer;
Beware of the 'false rebound' trap: if BTC quickly rises to $115K-$117K, it may be a whale's bait to offload, do not chase the highs.
V. The Ultimate Prophecy: Is the Bull Market Still On?
There is currently a huge divergence in the market:
Bulls: Expectations of the Federal Reserve cutting interest rates + Wall Street asset tokenization, BTC will hit a historic high of $139K;
Bears: New capital inflows on-chain have stagnated + BlackRock ETF funds are fleeing, BTC may test the bear market bottom of $105K.
But the truth may be harsher; the crypto market in 2025 has shifted from 'institutional bull' to 'retail speculation'. When whales retreat and retail investors take over, the market is bound to face bloodshed.
BTC's $111K lifeline is not only a technical threshold but also a test of human nature.
Remember: in the crypto market, surviving is more important than making money.
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