Bitcoin Whales Sell 500,000 BTC Institutional Demand Stabilizes Price

There is a significant shift occurring in the Bitcoin market, with large holders, or "whales," selling their substantial amounts of Bitcoin. These sales are being met with strong demand from institutional investors, including exchange-traded funds (ETFs), corporate treasuries, and asset managers. This dynamic is transforming the nature of Bitcoin from a highly speculative asset to a more stable, long-term investment vehicle.

Over the past year, whales have sold more than 500,000 Bitcoins. This amount is nearly equal to the net inflow of BTC into U.S.-approved ETFs and is close to the $65 billion BTC portfolio accumulated by MicroStrategy over five years. Despite this sell-off, Bitcoin's price has remained relatively stable at around $110,000. The increased institutional demand is contributing to a decrease in volatility, as Bitcoin transitions into a more mainstream asset class.

Edward Chin, co-founder of Parataxis Capital, notes that this transformation is partly due to whales using their Bitcoin as collateral in direct stock-related transactions. Institutions now hold nearly a quarter of the approximately 20 million Bitcoins in circulation, indicating a significant shift in market dynamics. Rob Strebel, director of Cumberland, DRW’s crypto arm, highlights that this development is turning crypto into a mainstream asset class with lower volatility. Deribit’s 30-day BTC Volatility Index has fallen to its lowest levels in two years, reflecting this trend.

However, experts caution that this shift poses risks. The long-standing goal of providing liquidity and an exit route for whales through institutional investors may now have been achieved, according to Hilary Allen, a law professor. Despite Bitcoin's price more than doubling in the last two years, it has remained stagnant since the beginning of 2025. Some analysts predict that Bitcoin's annual earnings potential could be capped at 10-20%, suggesting a more modest return on investment over time.

The market's future is uncertain, as not every whale movement can be tracked on-chain, and new catalysts could emerge at any time. Historical data shows that significant whale sales in the past have led to major market crashes. In a similar scenario today, the market could be thrown into disequilibrium if institutional demand stalls. Fred Thiel, CEO of bitcoin miner MARA Holdings, believes the market may be approaching its peak but acknowledges a different dynamic today. Markus Thielen, CEO of 10x Research, suggests that this transformation is long-term, with Bitcoin becoming an asset with a 10-20% return, changing its nature over time.