Bloomberg: In the past year, early Bitcoin holders have sold 500,000 BTC. Institutional inflows are stagnant, posing a risk of a sharp decline.

On July 4th, according to Bloomberg, despite a continuous stream of good news, the price of Bitcoin has been unable to break out of the current trading range for several months. Beneath the surface, while long-term dormant whales are reducing their positions, institutional investors are accelerating their purchases. This transformation is gradually changing Bitcoin's narrative from a high-risk speculative asset to a long-term allocation asset. According to 10x Research data, over the past year, large holders have sold more than 500,000 bitcoins (valued at more than $50 billion at current prices), which is nearly equivalent to the net inflows since the approval of the U.S. Bitcoin ETF, and is not far from the cumulative scale of $65 billion over the past five years by the cryptocurrency holding pioneer Michael Saylor and his company (now named Strategy). Many sellers can be traced back to the early days of Bitcoin when prices were much lower than the current levels. Some whales are not simply selling but are swapping tokens for stock-related assets through over-the-counter trades. Edward Chin, the co-founder of Parataxis Capital, stated: "What we are seeing is a rotation of underlying holdings. A less-covered driving factor is that whales are using Bitcoin as collateral to participate in stock-related financing transactions to shift their risk exposure." Despite the whale sell-off, over the past year, institutions such as ETFs and corporate treasuries have collectively absorbed nearly 900,000 bitcoins. These institutions currently hold around 4.8 million bitcoins, accounting for 20% of the circulation. However, observers warn that while institutions bring stability to the cryptocurrency market, they could also become the long-awaited exit path for whales. If market sentiment reverses, retail and retirement investors may bear the risk. The current main risk lies in the supply-demand imbalance: if whales resume large-scale selling while institutional inflows stall, the market could experience a sharp decline. According to 10x Research's data, in 2018 and 2022, price drops of 74% and 64% were triggered by outflows of only 2% and 9% respectively.