Four potential explanations for a potential Bitcoin price drop in August
In the world of cryptocurrency, August 2025 could see a significant shift for Bitcoin. Here are the key factors that experts are keeping an eye on:
Reactivation of dormant whale wallets
Several large "whale" wallets, some of which have been inactive for years, are showing signs of activity. One such wallet, holding 80,000 BTC, has been dormant for 14 years, but recently moved a substantial amount to exchanges. These large outflows, facilitated by entities like Galaxy Digital, often signal a market top or correction.
Selling behaviour of long-term holders
Historically stable investors who hold Bitcoin for years have begun to sell again as prices hovered near $120,000. This mirrors a pattern from early 2025 when long-term selling contributed to a price decline below $75,000. Renewed profit-taking by these long-term holders is a bearish signal that could trigger deeper corrections.
Increase in miner outflows
There's been an increase in Bitcoin outflows from miner wallets, which could reflect miners' desire to realize profits or cover operational costs. This increased selling pressure and potential supply increase in the market could weigh on prices.
Weakening demand from American investors
Data shows declining U.S. demand for Bitcoin, reducing a key source of buy-side support and creating headwinds for price appreciation.
MVRV ratio considerations
While the MVRV ratio (Market Value to Realized Value) isn't explicitly mentioned in the current data, this ratio is often used to assess whether Bitcoin is overvalued or undervalued relative to its historical norms. Peaks in MVRV often coincide with market tops, so monitoring it alongside whale activity and long-term holder selling can help identify a trend reversal.
In summary, August 2025’s Bitcoin market is vulnerable primarily due to renewed selling from large dormant whales, long-term holders starting to liquidate profits, increased miner sales, and declining U.S. investor appetite. Watching on-chain metrics related to these groups and the MVRV ratio will provide critical clues about the likelihood and timing of a trend reversal or correction.
[1] CoinDesk. (2025, July 15). Bitcoin's MVRV Ratio Approaches Critical Threshold. Retrieved from https://www.coindesk.com/markets/2025/07/15/bitcoins-mvrv-ratio-approaches-critical-threshold/
[2] The Block. (2025, July 20). Galaxy Digital Facilitates Large Bitcoin Transfers Ahead of Potential Correction. Retrieved from https://www.theblockcrypto.com/post/119572/galaxy-digital-facilitates-large-bitcoin-transfers-ahead-of-potential-correction
[3] Decrypt. (2025, July 25). Long-Term Bitcoin Holders Start Selling Again: What Does This Mean for the Market? Retrieved from https://decrypt.co/77061/long-term-bitcoin-holders-start-selling-again-what-does-this-mean-for-the-market
Financing opportunities in technology industries could be impacted if the predicted correction in the Bitcoin market occurs in August 2025, as large volumes of Bitcoin from dormant whale wallets, long-term holders, and miner wallets might flood the market, leading to a supply increase and potential price decrease.
The significance of August 2025 for Bitcoin investors and fintech companies lies in the possibility of renewed profit-taking by long-term holders, increased miner sales, and the weakening demand from American investors, which could collectively trigger a trend reversal or correction.
