Recent market data suggesting active accumulation of Bitcoin by large investors appears to mislead internal exchange management.
On January 2, Julio Moreno, head of research at analytics firm CryptoQuant, reported that on-chain signals initially interpreted as “whale” buying were primarily due to currency-related activity.
Sponsored Sponsored
Bitcoin whales reduce holdings as capital flows turn negative
He explained that the apparent accumulation was primarily driven by crypto exchanges consolidating assets.
Exchanges frequently reorganize their digital vaults, moving funds from multiple small deposit addresses to a few large cold storage wallets.
These technology transfers could mimic the footsteps of large investors buying large amounts of Bitcoin. Therefore, it generates false positive signals for market trackers.
However, Moreno noted that after excluding exchange internal transfers, there is a bearish trend among actual large holders.
According to him, Bitcoin “whales” (companies with 1,000 or more coins) and mid-sized “dolphins” investors have been net sellers throughout December.
Sponsored Sponsored
The total balance held by the group fell from around 3.2 million Bitcoins to just under 2.9 million Bitcoins in December, and has since revised slightly to 3.1 million Bitcoins.
Similarly, medium-sized wallets holding between 100 and 1,000 Bitcoin saw their total holdings drop to 4.7 million BTC.
Notably, this distribution activity coincided with asset price fluctuations. Bitcoin underwent a sharp correction in December, falling from a high of $94,297 to a low of $84,581, according to data from BeInCrypto.
Meanwhile, other data from blockchain intelligence firm Glassnode supports this decline. This indicates that monthly net capital inflows into the Bitcoin network turned negative in late December.
The reversal ended two consecutive years of uninterrupted positive inflows that began in late 2023.
At the same time, long-term holders, who typically endure volatility, are now locking in losses at a pace that exceeds the record set in early 2024.
This spike in realized losses signals a wave of “investor fatigue” and the capitulation of market cohorts traditionally seen as the most resilient.
