The Bitcoin strength index (BSI) collapsed to unprecedented lows this week as institutional giant Galaxy Digital liquidated over $1.6 billion worth of BTC in a series of high-volume transactions. The sell-off, linked to a dormant Satoshi-era whale moving 80,000 BTC ($9.7 billion) for the first time in 14 years, triggered mass liquidations exceeding $500 million in 24 hours.
“I have never seen Bitcoin this oversold. Never. This is beyond oversold,” remarked Crypto Analyst in an X post, referencing the Bitcoin strength index dropping to 6/100 on 15-minute charts, a level rarely seen in BTC’s history.
Despite the extreme volatility, the Bitcoin strength index has since shown signs of recovery, printing higher lows even as price action remains shaky.
Satoshi-era whale dumps $1.1B in BTC—market braces for impact
Blockchain analysts confirmed that Galaxy Digital moved another 10,000 BTC ($1.1 billion) to major exchanges, including Binance and Coinbase, intensifying fears of a prolonged correction. The whale, who first transferred 40,000 BTC on July 15 and another 40,000 BTC on July 18, has now offloaded nearly half of their holdings.
“The 10,000+ BTC comes from the Bitcoin OG holding 80,009 BTC ($9.68B),” reported Lookonchain, sparking debates over whether the market can absorb such a massive supply shock.
While some, like financial analyst Jacob King, warned of a “burst bubble,” others downplayed the risks.
“Dormant whale movements have not consistently preceded significant market corrections,” Bitfinex analysts told journalists, suggesting the Bitcoin strength index downturn may be temporary.
Bitcoin strength index divergence hints at bullish reversal
Despite the sell-off, traders spotted a silver lining: the Bitcoin strength index began forming bullish divergences, with RSI values rising even as prices tested lower support levels. This rare signal often precedes recoveries, and some analysts believe the worst may be over.
“Time to watch for sure,” said trader Skew, noting that panic-selling volume was absent. “I see the current state of the market as cautionary more than panic.”
He identified $117,000 as a critical resistance level for BTC’s rebound.
Meanwhile, onchain analyst EmberCN estimated that only 12,000 BTC ($1.38 billion) remain to be sold, adding:
“With current liquidity, absorbing these coins shouldn’t have a significant impact.”
Bitcoin strength index crashes to historic lows as Galaxy Digital offloads $1.6B in BTC
Institutional demand could rewrite Bitcoin’s cycle
The Bitcoin strength index’s extreme volatility has reignited debates about BTC’s traditional four-year cycle. Ki Young Ju, CEO of CryptoQuant, argued that “old whales sell to new long-term whales,” signaling institutional dominance over retail trading.
“Trading feels pointless. Holders now outnumber traders,” Ju tweeted, pointing to spot Bitcoin ETFs and firms like Tether accumulating BTC.
Bitget COO Vugar Usi Zade echoed this, telling Cointelegraph that institutional inflows could accelerate Bitcoin’s cycle toward new all-time highs.
Key points:
The Bitcoin strength index hit historic lows amid Galaxy Digital’s $1.6B sell-off.
A Satoshi-era whale moved $9.7B in BTC, but analysts say markets may absorb the shock.
Bullish RSI divergences suggest a potential recovery, with $117,000 as a key target.
Institutional demand is reshaping Bitcoin’s market cycle, reducing retail-driven volatility.
Jeremiah Musa lives and breathes storytelling. For over 12 years, he's chased breaking news, crafted hard-hitting features, and built content strategies that cut through the noise. These days, you'll find him leading the charge at The Bit Gazette, where he oversees a team of writers digging into the biggest stories in crypto.
Based in Dubai's fast-moving fintech scene, Jeremiah has a knack for translating complex blockchain concepts into sharp, engaging content. He's just as comfortable breaking down a Bitcoin whitepaper as he is explaining market moves to newcomers. Before diving into crypto, he cut his teeth in traditional financial journalism, covering everything from emerging markets to regulatory shakeups.
What keeps him up at night? Finding the human angle in every tech story. When he's not editing copy or prepping PR campaigns, he's probably arguing about the future of Web3 over karak chai or hunting down Dubai's best shawarma.
