BTC Chip Concentration Hits 12%, Suggesting Impending Price Volatility

Crypto analyst Murphy points out that the concentration of chips in a 5% range of the BTC spot price has reached 12%, up from 10% in May. This is significant because it indicates that market sentiment has become more fragile and unstable, making it prone to larger fluctuations. According to historical data, a concentration greater than 15% is associated with a higher probability of triggering a major market move.

The analyst notes that the current upward trend of this indicator suggests that the market is approaching another significant turning point window. In November 2025, the concentration reached 18%, and in January 2026, it hit 16%. However, after a price drop followed by February's supply-side marginal diminishing effect, prolonged low circulation and turnover reduced the prominence of chip concentration.

If BTC continues to move sideways in the range of $62,000 to $66,000, the concentration of chips will likely increase further. This could lead to a violent breakout as the overly concentrated chips are redistributed, possibly marking an important directional decision at the end of this bear market cycle.