As Bitcoin weakens recently, previously inactive long-term holders have begun to join the selling. Compass Point reports that these funds have shifted from a wait-and-see approach to selling in recent weeks, with approximately $2.4 billion worth of Bitcoin sold in the last two days, increasing market supply and demand pressure.
Long-term holders turned to net selling
Compass Point defines long-term holders as investors who hold their currency for at least 155 days. The firm says these accounts were largely silent between February and April, but have clearly turned to selling in recent weeks.
Analyst Ed Engel pointed out that 26% of the Bitcoin sold in the past 30 days came from investors who bought at prices above $90,000. These high-level buyers, who had previously remained relatively stable during the decline, are now also starting to exit the market en masse.
High-priced buyers surrendered and sold off.
Engel believes that this type of concentrated selling by high-level buyers is common in the later stages of a bear market. Based on this assessment, while the current selling pressure has intensified, it may also indicate that this round of Bitcoin's downward cycle has entered its latter half.
Continuous outflows from ETFs dampen sentiment.
In addition to selling pressure from holders, the inflow of funds into the spot Bitcoin ETF also continued to weaken. SoSoValue data shows that as of Monday, the Bitcoin ETF had experienced net outflows for 11 consecutive trading days, setting a new record for the longest consecutive outflow.
Citigroup analyst Alex Saunders stated that ETF inflows remain a significant variable influencing Bitcoin's price, explaining approximately 45% of weekly return volatility. Recent continuous outflows indicate that investor risk appetite remains weak.
Geopolitical tensions and liquidation amplified the decline.
The report noted that Bitcoin has consistently failed to approach its October high of over $126,000. Continued uncertainty surrounding the US-Iran war has suppressed prices, while US stocks have reached new highs during the same period. This divergence has led the market to re-evaluate Bitcoin's narrative as both a safe-haven asset and a risk asset.
Bitcoin has fallen 10% this week. Monday's panic selling triggered a chain reaction of long position liquidations, further amplifying the decline. The report also stated that Strategy's sale of 32 Bitcoins was not the primary driver of this decline.
