54% of Binance Futures Traders Are Shorting BTC — Will Price Follow?

Key Insights:

• Binance Futures data shows 54% of traders are shorting Bitcoin, suggesting increasing downside sentiment.
• Whale inflows surged $17B recently, historically a sign of profit-taking and correction phases.
• The UK may offload £5B worth of seized BTC, potentially triggering significant market pressure.

Data from Binance on July 20 shows 54.03% of accounts hold short positions against Bitcoin. Long positions accounted for 45.97%, pushing the long/short ratio to 0.85. The metric reflects a bearish tilt in trader sentiment over the last 4-hour interval.

This shift comes as Bitcoin trades at $117,927, down 0.28% on the day with a 24-hour trading volume of $47.03B, according to CoinMarketCap. The volume declined by 25.71% over the same period, suggesting reduced market activity.

Concurrently, the Bull Score Index by CryptoQuant shows Bitcoin’s score rising to 80. The index measures sentiment and liquidity conditions, and readings above 75 often precede local price reversals. This level last coincided with temporary price pullbacks during earlier rallies in 2024.

Whale Inflows and UK Bitcoin Sell-Off Add Downside Risk

According to on-chain analytics from CryptoQuant, whale inflows into exchanges rose sharply in recent days. Between July 14 and July 18, the 30-day sum of whale inflows jumped from $28 billion to $45 billion, a $17 billion increase. The chart shows similar inflow levels previously occurred near market peaks in April 2024 and November 2024.

A single 80,000 BTC movement may have contributed to this spike, although it also reflects broader whale behavior. Historically, when monthly exchange inflows surpassed $75 billion, it preceded consolidation or correction phases. This pattern is consistent with profit-taking activity near price highs.

Separately, the UK government is preparing to sell over £5 billion worth of Bitcoin seized in criminal investigations. UK officials have recovered 61,000 BTC from a Chinese Ponzi scheme, now valued at over £5.4 billion at current prices. At current prices, this holding is valued at more than £5.4 billion ($7B USD), far exceeding its value at the time of confiscation.

The Home Office and law enforcement are coordinating a large-scale crypto liquidation, with the Treasury expected to benefit. Aidan Larkin, CEO of Asset Reality, noted that these assets could return “hundreds of millions of pounds annually” to the UK economy. The planned sale may be one of the largest of its kind by any government.