Bloomberg: Whale sell-off, institutions accelerate purchases, market supply and demand imbalance risk rises

According to ChainCatcher news and Bloomberg reports, despite the continuous favourable information, the Bitcoin price has failed to break through the current trading range for several months. Beneath the surface, long-silent whales are reducing their positions, while institutional investors are accelerating their purchases. This transition is gradually shifting Bitcoin's attributes from a high-risk speculative asset to a long-term allocation asset. According to 10x Research data, over 500,000 Bitcoins (valued at over $50 billion at current prices) have been sold by large holders in the past year. This is nearly equivalent to the total net inflow of Bitcoin ETF in the United States since its approval, and it is not far from the $65 billion accumulation by cryptocurrency holdings pioneer Michael Saylor and his company (now known as Strategy) over the past five years. Many sellers can be traced back to the early cycles of Bitcoin, when prices were far below current levels. Some whales are not simply selling off, but are swapping tokens for stock-related assets through over-the-counter transactions. Edward Chin, co-founder of Parataxis Capital, stated: "What we are seeing is a replacement of underlying holdings, and a less noticed driving factor is that whales are participating in equity-linked financing transactions through Bitcoin physical contributions to convert their risk exposure." Despite the reduction in holdings by whales, institutions such as ETFs and corporate treasuries have collectively absorbed nearly 900,000 Bitcoins over the past year. These institutions currently hold about 4.8 million coins, accounting for 20% of the circulating supply. However, observers warn that while institutions are bringing stability to the cryptocurrency market, they may also become the exit channel that whales have long hoped for—if market sentiment reverses, retail and retirement investors may bear the risk. The main risk currently lies in the imbalance of supply and demand: if whales restart large-scale sell-offs while institutional inflows stagnate, the market could plummet sharply. According to data from 10x Research, in 2018 and 2022, a mere 2% and 9% outflow of funds respectively triggered Bitcoin price drops of 74% and 64%.