Bitcoin fell big dump below 112,000 USD in August! Three key reasons exposed, whale selling is just the beginning.

In the last week of August 2025, the Bitcoin (BTC) weekly chart closed at its lowest level since the beginning of last month, with prices briefly falling below $112,000, marking a new low in nearly two months. Although The Federal Reserve (FED) Chairman Powell hinted at a possible interest rate cut in Jackson Hole, which sparked optimism in the market, on-chain data and market structure indicate that three key factors ultimately triggered this sharp decline.

Reason 1: Large whale sell-off, funds shifting to Ethereum

(Source: Arkham)

Event Review: On August 25, Bitcoin fell sharply from above $117,000 to $110,000.

On-chain data: Arkham detected that the dormant OG whale wallet "19D5J8", which had been asleep for 5 years, holds 23,969 BTC (nearly 300 million USD), and suddenly transferred most of its funds, with 12,000 BTC being sold off on the same day.

Capital flows: Another whale wallet sold over 18,000 BTC and instead bought Ethereum (ETH).

Market interpretation: Driven by institutions like Bitmine and SharpLink increasing their ETH holdings, more whales may follow suit, further intensifying the selling pressure on BTC.

Reason 2: Weekend liquidity is thin, amplifying volatility

Market characteristics: Weekend trading volumes are usually lower than on weekdays, and this will also be the case in August 2025.

CryptoQuant data: Sunday trading volume plummeted, forming a "liquidity trap," where a single large whale sell-off can trigger severe volatility.

Chain reaction:

1. Stop-loss orders are more easily triggered.

2. The order book depth for spot and derivatives is insufficient.

3. A small amount of selling pressure can quickly cause the price to fall.

Reason 3: Exchange Bitcoin reserves surge, selling pressure accumulates in advance

(Source: CryptoQuant)

Data Observation: XWIN Research Japan points out that the exchange BTC reserves often surge before a weekend fall.

Interpretation: This means more Bitcoin is being transferred to exchanges, increasing potential selling pressure.

Chart Trend: The reserve levels remained high from Saturday to Sunday, making the market more vulnerable in a low liquidity environment.

Summary: The 'Perfect Storm' of August

Whale sell-offs, insufficient weekend liquidity, and rising exchange reserves have formed a triple pressure on Bitcoin's sharp decline in August.

Despite the Jackson Hole meeting releasing potentially favorable signals for interest rate cuts, these structural selling pressures ultimately outweighed the short-term optimistic sentiment.

Key Support and Risks:

Short-term support: $105,000 (June breakout area)

Psychological barrier: $100,000 (main strike price of options)

If it falls below $100,000, it may trigger a new round of deleveraging sell-off.