Since the launch of spot Bitcoin ETFs, long-term holders have been consistently selling their assets to institutional buyers, contributing to a period of price consolidation.
According to market analysts, sustained selling pressure from early Bitcoin investors has limited upward price movement despite growing institutional and corporate interest in the cryptocurrency.
“Many are wondering why Bitcoin has been trading sideways around the $100,000 mark despite clear institutional FOMO,” observed Charles Edwards, founder of Capriole Investments, in a recent market commentary.
He attributed this phenomenon primarily to early Bitcoin adopters—often referred to as OGs—who have been “selling to Wall Street” and “unloading their positions” since the introduction of spot Bitcoin exchange-traded funds in January 2024.
Edwards shared data illustrating the growth rate of Bitcoin holders, noting a significant surge in the six-month holder cohort representing a new wave of corporate Bitcoin accumulation. “The amount of Bitcoin acquired by this group over the past two months has completely absorbed all the selling from long-term holders over the preceding 1.5 years.”
The Bitcoin Treasury Flywheel Effect
Edwards predicts that these corporate Bitcoin treasury acquisitions will create a “powerful flywheel effect of buying frenzy” that could eventually overshadow the current ETF narrative.
“We've clearly entered the next phase of adoption as numerous companies are following the trend,” he noted.
This observation coincides with several new corporate entrants to the Bitcoin space last week alone, including real estate giant Cardone Capital, Anthony Pompliano's venture firm ProCap (which plans to go public), mineral exploration company Panther Metals, and Norwegian deep-sea mining firm Green Minerals.
Short-Term Profit Taking
Jeff Mei, Chief Operating Officer of BTSE cryptocurrency exchange, explained that short-term traders have been taking profits ahead of the July 9 tariff deadline, as many anticipate ongoing fundamental uncertainties.
“Traders are hedging against potential price declines should trade negotiations prove unfavorable,” he stated, while acknowledging that increasing numbers of public companies are incorporating Bitcoin into their treasury operations. “While these companies need time to accumulate meaningful positions, we expect the market to stabilize next year as more long-term holders enter the space.”
Meanwhile, Han Xu, Investment Director of Liquid Funds at HashKey Capital, noted that investors and traders are awaiting key U.S. macroeconomic data releases and policy updates this week.
“Updates on trade agreements ahead of the reciprocal tariff deadline, along with developments regarding the Trump budget proposal, represent critical risk factors that must be resolved to maintain the bullish trend,” he cautioned, adding that any unexpected negative developments “could trigger selling pressure.”
Continued Sideways Trading
Since initially breaking through the six-figure price level in early May, Bitcoin has largely traded within a consolidated range. The asset has fluctuated between $102,000 and $110,000 with occasional brief spikes and corrections.
Despite relatively muted market activity, U.S. spot Bitcoin ETFs have recorded over $3.2 billion in inflows during the past two weeks without a single day of outflows. Simultaneously, the number of new corporate Bitcoin treasury announcements continues to grow weekly.
As of recent trading, Bitcoin attempted to break above resistance at $108,750—marking its highest level in two weeks—but ultimately failed to sustain this momentum at the time of writing.
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Frequently Asked Questions
Why has Bitcoin's price been stagnant despite institutional buying?
Early long-term holders have been selling their positions to institutional investors through ETFs, creating a supply dynamic that has balanced out new demand. This selling pressure from original holders has offset institutional accumulation, resulting in price consolidation.
What is the Bitcoin treasury flywheel effect?
This refers to the anticipated cycle where corporate Bitcoin purchases create price stability and upward momentum, attracting more companies to allocate to Bitcoin, which in turn creates further price support and institutional interest.
How are tariff deadlines affecting Bitcoin's price?
Traders are taking short-term profits and hedging positions ahead of key economic deadlines due to uncertainty about potential market impacts. This risk-off behavior contributes to sideways trading patterns.
Will corporate Bitcoin buying continue to grow?
Current trends suggest increasing corporate adoption as more companies announce Bitcoin treasury allocations weekly. This institutional adoption pattern appears to be establishing a new foundation for long-term market structure.
What key factors could break Bitcoin out of its current range?
Clear resolution of trade negotiations, positive macroeconomic policy developments, and sustained ETF inflows without corresponding selling from long-term holders could provide the necessary momentum for a significant price breakout.
How are ETFs affecting Bitcoin's supply distribution?
ETFs are facilitating a transfer of Bitcoin from early individual holders to institutional entities and corporate treasuries, effectively changing the ownership structure of Bitcoin while creating a more institutionalized market framework.