A $2.1 trillion Bitcoin market is undergoing a quiet shift of control, where 'whales' or large Bitcoin holders who have been around for a long time are starting to sell off much of their holdings, while institutional players, such as ETFs, large companies, and asset managers, are beginning to accumulate more Bitcoin.
As a result, Bitcoin is struggling to break its all-time high of around $110,000, despite numerous bullish headlines touting broader crypto adoption.
Over the past year, Bitcoin whales have sold more than 500,000 BTC, worth over $50 billion at current prices. This selling is nearly comparable to the net inflows into US exchange-traded funds (ETFs).
These whales predominantly originate from the early Bitcoin cycle, when prices were still very low. However, now some of them are not only selling but also exchanging their Bitcoin for equities in the stock market.
As sales by whales decline, large institutions now control about a quarter of the total Bitcoin in circulation.
In 2020, it was estimated that about 2% of traceable anonymous ownership accounts controlled 95% of the total Bitcoin supply.
However, this power dynamic is quickly changing, with institutions increasingly taking control.
Bitcoin is now starting to show lower volatility, with one of its volatility indicators, the BTC Volatility Index, dropping to its lowest level in the past two years.
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