Bitcoin’s price is under heightened bearish pressure as it falls back to the $90,000 level, raising the potential of the beginning of a bear market phase. With the price of BTC dropping fast, selling pressure is rising rapidly in the market, which is extending into the institutional landscape.
Are Bitcoin Institutional Investors Exiting?
In a significant development, several large corporations are starting to react strongly to the ongoing correction in Bitcoin’s price. As market volatility increases, institutional investors, who were once seen to be the stabilizing force driving Bitcoin’s maturation, are now starting to unwind some of their holdings.
Related Reading: Massive Bitcoin Outflow Hits Galaxy Digital Wallets: 1,531 BTC Moved
One of the most recent corporations that has recently gone on a selling spree is Digital Galaxy. Galaxy Digital has secretly started to sell off some of its Bitcoin holdings, signifying a significant change in conduct from one of the most powerful institutional stakeholders in the sector. The firm’s decision to begin selling BTC after months of consistent accumulation and long-term strategy is causing controversy in the cryptocurrency space.
According to Darkfost, the firm, championed by billionaire and investor Mike Novogratz, has been quite active over the past few weeks, selling off thousands of its BTC stash at a rapid rate. During this period, Galaxy Digital transferred more than 2,800 BTC for the purpose of selling.
Data shared by the expert revealed that 1,474 BTC valued at $135 million were moved to America’s leading cryptocurrency exchange, Coinbase Prime, within a few hours. Darkfost stated that this selling pressure is likely to extend the ongoing downward trend of Bitcoin’s price.
Sales are still mostly under control, but they show signs of strategic repositioning in the face of increasing volatility and changing macro signals. Meanwhile, should the trend become highly popular among institutional investors, it could impact the course of BTC in the upcoming weeks and months.
BTC’s Current Downtrend Driven Largely By Long-Term Holders
Since the sharp pullback in Bitcoin’s price, many developments have been linked to the decline. However, the one that stands out the most is the negative action of long-term BTC holders or old Bitcoiners in the market.
Related Reading: Bitcoin Buyers Step In: Largest Accumulation Wave Emerges In the Heart of Market Fear
As reported by Ki Young Ju, the founder and Chief Executive Officer (CEO) of CryptoQuant, the current dip is a result of long-term BTC holders rotating among themselves. Old Bitcoiners are selling their coins to TradFi players, who will likewise hold for the long run.
At the beginning of the year, Young Ju predicted that BTC had reached a top, putting an end to the bull cycle. The increased selling pressure from OG whales supported his forecast. Meanwhile, current trends show that the market structure has shifted, with ETFs, MSTR, and other new channels persistently adding fresh liquidity.
Despite waning price performances basically caused by OG whales dragging the market, on-chain inflows remain strong. These days, corporate treasuries, multi-asset funds, pension funds, and sovereign funds are creating even larger liquidity channels. Young Ju claims that as long as these liquidity channels stay active, the cycle theory is dead.
Featured image from Pngtree, chart from Tradingview.com
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