The post Are You Selling Your Bitcoin to Institutions? Key Reasons to Reconsider and Hold BTC first appeared on Coinpedia Fintech News.
Over the past year, there has been a massive shift in Bitcoin ownership, where institutional players are increasingly accumulating BTC. This trend was accelerated shortly after the approval of spot ETFs in January 2024. On the other hand, many retail investors, tempted by short-term profits or scared by volatility, are shedding their BTC holdings. But here’s the twist: they are selling to the very institutions that doubted Bitcoin and are the same ones that now believe BTC is a long-term value asset.
On-chain data suggests that institutional demand for BTC has been increasing since the beginning of the second quarter. Meanwhile, demand for the token from retail investors has taken a significant hit since the beginning of the year, which marginally increased when the price hit a new ATH but then fell again. This suggests that institutions are driving the current BTC uptrend, with ETFs and corporate treasuries accumulating aggressively. Meanwhile, the relative absence of retail may mean accumulated FOMO if the price breaks out of the range, leading to sharp volatility as new buyers enter, and also more risks of local tops as sentiment surges.
Therefore, retail traders are expected to remain focused on increases in volume and spot demand, as some factors point to significant price action very soon.
At $108K, the BTC price is still undervalued.
The price of Bitcoin still shows room to grow, as suggested by the Mayer Multiple, which is an oscillator calculated as the ratio between the price and the 200-day moving average. It helps to determine whether Bitcoin is potentially overbought, fairly priced, or undervalued. A higher multiple suggests that the BTC price is being traded at a premium; however, current rates are lower, indicating that the token is at discounted rates.
As seen in the graph above, Bitcoin's Mayer Multiple is at 1.1x, just 10% above its 200-day moving average and well below the overheated zone of 1.5x. This signals that it is not overheated even during moments when the BTC price is just a step away from its ATH. This suggests that the token still appears to be undervalued even while trading at $108K.
Another Sleeping Whale Awakens.
In recent days, the crypto space witnessed a historic event of dormant wallets suddenly becoming active after 14 long years. Additionally, part of the transferred Bitcoin was reportedly being sold, which generated enough bearish pressure on the token, but the price consolidation near BTC suggests that bulls are still in control. However, a similar event occurred where Bitcoin marked the third-largest recovery of old supply in a single day in history.
Glassnode data suggests that over 80,000 BTC that remained inactive for more than 5 years are in motion. A similar event occurred in mid-2024 and in the early days of 2022. At times when Bitcoin's market capitalization is above $2 trillion, nearly $8.6 billion in BTC transfers could be quite significant. However, the short-term impact on price remained negligible, but a supply shock may be on the way.
In conclusion!
At a time when institutions are aggressively accumulating Bitcoin, retail investors should take a pause and reflect on the long-term implications of selling. The value of Bitcoin does not reside solely in its price, but in its design as a decentralized and finite asset. By holding, you preserve your financial sovereignty and partake in a rare economic shift. Selling now may offer short-term gains, but holding may position you for exponential value creation as global adoption and institutional interest continue to accelerate in the coming years.
