The crypto market has taken a breather after an intense few days driven by political developments. After Bitcoin hit a new all-time high of $112K on May 22, 2025, markets immediately cooled off the next day when US President Trump announced a 50% tariff on goods from the European Union. This caused panic among traders, especially with the memory of recent trade war effects still fresh. But within just two days, the White House hit the brakes and delayed the tariffs until Jul 9, 2025, similar to wider tariff pauses on Apr 9, 2025, sparking a major bullish breakout and the eventual new all-time high last week.

In the latest development, a US federal court ruled on May 28, 2025 that Trump had overstepped his authority with the “Liberation Day” tariffs. This decision invalidated the tariffs by stating they had violated the Constitution because they bypassed Congress. While the White House quickly appealed, arguing that emergencies fall under presidential powers, the case has sparked renewed debate over checks and balances. With more than 60 countries affected and businesses warning of rising costs, this legal challenge may have an impact on the way that markets interpret future tariff threats.

Santiment data shows that whenever tariff discussions spike on social media, crypto prices often react sharply. One of the largest jumps in mentions of trade conflict occurred in the final days of May, echoing a similar burst of activity seen during the steep correction in early April. Although the damage was lighter this time, the market’s mood clearly shifted as investors braced for further volatility.

Crowd Sentiment Shifts: Greed Marks Tops, Fear Marks Bottoms

Santiment’s crowd sentiment data shows just how reactive the market has become to sudden news and emotional swings. On May 22, 2025, when Bitcoin hit its all-time high, positive sentiment predictably skyrocketed. And since markets move in the opposite direction of retail’s expectations, prices sharply corrected immediately after, punishing the high FOMOers who were expecting a continued surge to $115K and beyond. This moment of “greed” was reflected by a high ratio of bullish (compared to bearish) sentiment, signaling that traders were being overly optimistic.

By contrast, on May 25, 2025, when Bitcoin mildly dropped back to around $106K, sentiment turned extremely fearful before prices bounced again. This pattern continues to reliably foreshadow price reversals, making retail traders’ activity one of the most reliable counter signals in crypto.

It was also reported by Vivek on X that the most popular call option is $300K Bitcoin by June 2025. Though this sounds lofty, it does reflect the crowd’s still-bullish optimism for the long term.

Understanding how emotions play into trading is key. In the particularly fragile current market conditions, where global economic events are causing incomparable volatility, we highly recommend watching which way the crowd is leaning. These recent price swings offer a perfect case study in how traders’ feelings often become their own worst enemy.

Tariff Talk Spikes = Price Volatility

Tariff-related chatter on social media has had a striking correlation with Bitcoin’s price movements. Santiment chart that tracks mentions of “tariff,” “tariffs” and “trade war” shows multiple sharp spikes, each of which aligns with sudden Bitcoin price drops or volatility. For each instance in which Trump has threatened tariffs, markets have quickly and predictably reacted with sharp drawdowns.

Once considered a hedge against government actions, crypto is now responding more like a tech stock as macro risks are introduced. Many in the space eventually want to see crypto become immune to swings from real-world events, but for now, the 17-year-old sector can’t escape the weight of global economic uncertainty.

Supply Continues Leaving Exchanges

One of the stronger long-term bullish signals in crypto is the amount of Bitcoin sitting on exchanges. Since the start of 2025, there’s been a net total of 147,160 fewer BTC on exchanges than at the end of 2024. Data shows a consistent downward trend since interest rates stopped in 2022. This reduction in supply often signals that traders are moving their assets to long-term storage, reducing the likelihood of immediate selling pressure and increasing the likelihood of long-term price rises.

When supply falls during a price rally, it generally means that investors expect higher prices ahead, and shows confidence in the market’s long-term direction. This supply drain supports the case that, despite news-driven swings, many large holders (in particular) are accumulating and not selling.

Dormant Coin Movement Can Propel Longer Bull Cycle

The Mean Dollar Invested Age (MDIA) metric tracks how long coins are sitting on average in wallets without moving. During most bull cycles, a falling MDIA (meaning average holding wallets are getting younger) is a great validator that bullish momentum will continue. More technically, a falling line indicates that old coins are being brought back into circulation, allowing utility to rise and an asset’s network to grow and flourish. Since mid-April, when tensions began to ease over the initial tariff announcements, Bitcoin’s MDIA has been dropping steadily.

These kinds of moves during price rallies hint that long-time holders are taking realized profits. Historically, profit-taking from Bitcoin’s millions of wallets (while others accumulate those sold coins) is a necessary component to help keep a rally alive. Over the past six weeks, the average age of bitcoins being held has dropped from 443 days to 426. This adds weight to the argument that the market is in an active phase, and not just being driven by short-term speculation.

Whales Show Clear Signs of Profit-Taking, Marking Quick Reversal After All-Time High

Whale activity saw a sudden spike last week, just as Bitcoin’s market value was marking history at $112K. The number of Bitcoin transactions above $100K (18,782 in a single day) marked the highest whale activity levels since the previous January all-time high, when Trump was inaugurated. These large moves are rarely made by casual traders who don’t have large amounts of capital (this is why we refer to them as “whale transactions”). Instead, they often represent institutional or long-term investors shifting funds for strategic reasons.

High whale activity during market tops can sometimes point to distribution, or smart money taking profit. We have consistently seen sudden major whale transaction spikes mark price bottoms (like the one we saw on Apr 7, 2025) or price tops (i.e., May 22, 2025). Think of them as fantastic reversal indicators, with the latest signal showing some clear profit-taking.

Meanwhile, a discovery from @cryptobeastreal went viral on X after it was pointed out that a whale with a 40x leveraged position increased the value of their perpetual contract to $1.2B.

This obviously has led to fascination from the retail crowd, with most (who are bullish themselves) obviously cheering this whale on. But if this position somehow gets liquidated with Bitcoin’s market value following below $104,810, it could lead to disaster for many holders and other long positions. When major longs get liquidated, prices typically move down sharply because the major capital is no longer propping up price. This works in reverse as well when liquidated shorts (traders using leveraged positions to bet against Bitcoin or other coins) act as “rocket fuel” to propel Bitcoin’s market value upward.

Average Returns Still Leaning High a Week After All-Time High

The Market Value to Realized Value ratio (MVRV) offers a window into how “in profit” different groups of holders are. A 30-day MVRV, for example, reflects how far above or below the “zero sum game” active traders have been during this time. When investing in an asset that already has significant average profit among all active traders, it means you’re investing with increased risk as compared to the average historic point because not enough traders are losing money.

That said, on May 22, 2025, both 30-day and 365-day MVRV ratios were well above 0%, meaning that both short- and long-term holders were, on average, deep in profit — an ideal time for many to take gains. By contrast, on March 10 and April 7, both MVRV metrics dipped far below 0%, indicating that most holders were in the red — historically a strong buy signal.

When using MVRV, it’s typically best to look at short- and long-term average returns together. When both 30-day and 365-day traders are winning far more than average, this is typically a spot when you can safely take some profit. Alternatively, when traders during both of these time frames are losing, it often creates the perfect setup for a bounce, allowing you to justifiably buy at a low-risk moment.

What to Watch For in June

While the market continues to digest the fallout from Trump’s tariff threats and the recent federal court ruling, the behavior of traders and large stakeholders tells a more subtle story. We’ve seen sentiment flip from euphoric to fearful in a matter of days, and price behavior has followed these emotions with near-perfect timing. Social trends, supply movement and whale transactions all indicate that — even in a volatile environment — there are data-backed clues that can help predict where the market might head next. For those willing to look past the headlines, tools like Santiment offer a clearer view of the underlying dynamics shaping Bitcoin’s price direction.

Ultimately, the crypto market remains highly reactive to global events, and the July 9 tariff deadline now looms as a key turning point. Whether or not Trump is allowed to enforce the tariffs could determine whether this current sideways movement becomes a deeper correction, or a launchpad for another rally. In the meantime, traders would do well to balance macro headlines with on-chain fundamentals, keeping a close eye on metrics like MVRV, whale activity and crowd market sentiment. These indicators continue to act as either reliable warning signs or green lights in a market where patience, rather than panic, tends to be the more profitable path.

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Disclaimer: The opinions expressed in the post are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.