Grayscale Says Bitcoin Price Bottomed at $63,000 Amid Massive BTC Supply Drain

Bitcoin is showing signs of stabilization after months of uncertainty, with fresh data suggesting the market may have already established a durable bottom.

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According to an analysis from Grayscale’s head of research, Zach Pandl, Bitcoin (BTC) reached its base on February 5 at $63,000. The ex-Goldman Sachs macro strategist shared this in his recent “The Stack” article, suggesting that it could be up only for the premier asset from here on.

Key Points

• According to an analysis from Grayscale’s head of research, Zach Pandl, Bitcoin reached its base on February 5 at $63,000.
• Pandl cited an on-chain metric showing that recent buyers have turned profitable to back his view that Bitcoin likely bottomed.
• The data indicate that they have recovered from earlier losses as BTC rallied past their average entry of $74,000.
• CryptoQuant data shows that Bitcoin reserves held on exchanges have been steadily declining.
• Large financial players are also absorbing significant amounts of Bitcoin, which can create a supply shock.

Bitcoin Price Has Bottomed

Pandl claimed the February 5 low could be the steepest the premier asset would reach this cycle. While Bitcoin moved a tad lower to $60,000 the next day, his view is that it would not return to those price levels again but would instead target higher prices.

Meanwhile, Bitcoin has recovered from that price level, growing over 23% to the current market price of $78,000. It reached an intraday high of $78,441 today, breaking last week’s peak of $78,361. The bullish momentum has ensured that the coin retests price levels last seen in early February.

The Bitcoin resurgence follows the easing of the pressure from the US-Iran fracas. Market volatility dropped as Donald Trump extended the ceasefire, tanking oil prices and spurring a recovery in the global market.

On-Chain Data Signals a Shift in Market Structure

Furthermore, Pandl cited an on-chain metric to back his sentiment. He cited the BTC realized price for coins that moved over the past 1 to 3 months, which is around $74,000. The data indicates that many recent buyers have recovered from earlier losses and are no longer under pressure to exit positions.

As a result, selling pressure appears to be easing. Historically, this type of transition has marked the early phase of broader bull cycles. Furthermore, when short-term holders move back into profit, it often strengthens market confidence, encouraging greater participation.

As such, price action is beginning to resemble patterns seen at the start of previous cycles. The Grayscale exec noted that while Bitcoin remains below its October 2025 highs, the current recovery suggests the market is shifting away from a corrective phase and toward renewed momentum.

Supply Tightening as Institutions Accumulate

Beyond price signals, supply dynamics are becoming increasingly important. A recent CryptoQuant analysis shows that Bitcoin reserves held on exchanges have been steadily declining, reflecting reduced supply availability. This trend has been building over the past two years and continues to accelerate.

An accompanying chart shows that since 2023-2024, the Bitcoin reserve on all exchanges has steadily declined, falling from around 3.25 million BTC to 2.67 million BTC today. This rapid shift from centralized to self-custody platforms highlights the strengthening HODL sentiment among market participants.

Meanwhile, large financial players are absorbing significant amounts of Bitcoin. Firms such as BlackRock, Morgan Stanley, Charles Schwab, and Goldman Sachs are expanding their exposure through various financial products and services. In parallel, Strategy continues to add to its holdings, further tightening available supply.

Consequently, this steady accumulation is reducing the amount of Bitcoin circulating on exchanges. Over time, such conditions can create a supply shock, especially if demand continues to increase.