Recent market data suggesting aggressive Bitcoin accumulation by large investors appears to be a misinterpretation of internal exchange housekeeping.
On January 2, Julio Moreno, head of research at analytics firm CryptoQuant, reported that on-chain signals initially interpreted as “whale” buying were mainly due to exchange-related activity.
Bitcoin Whales Cut Holdings as Capital Flows Turn Negative
He explained that the apparent accumulation was driven mainly by cryptocurrency exchanges consolidating their assets.
Exchanges frequently reorganize their digital vaults, moving funds from multiple smaller deposit addresses into fewer, larger cold storage wallets.
These technical transfers can mimic the footprint of a large investor purchasing massive amounts of Bitcoin. Thus, creating false positive signals for market trackers.
However, Moreno noted a bearish trend among actual large-scale holders after filtering out exchange-internal transfers.
According to him, Bitcoin “whales”—entities holding more than 1,000 coins—and mid-tier “dolphin” investors have been net sellers throughout December.
The total balance held by this cohort dropped from approximately 3.2 million Bitcoin to just under 2.9 million in December, before a slight correction to 3.1 million.
Similarly, mid-sized wallets holding between 100 and 1,000 Bitcoin saw their collective holdings decline to 4.7 million BTC.
Notably, this distribution activity coincided with a volatile period for the asset’s price. Bitcoin corrected sharply in December, falling from a high of $94,297 to a low of $84,581, according to data from BeInCrypto.
Meanwhile, separate data from blockchain intelligence firm Glassnode corroborates the sell-off. It shows monthly capital netflows into the Bitcoin network turned negative in late December.
This reversal ended a two-year run of uninterrupted positive inflows that began in late 2023.
At the same time, long-term holders, who typically hold through volatility, are now locking in losses at a pace that exceeds the records set earlier in 2024.
This spike in realized losses suggests a wave of “investor fatigue” and capitulation among the market cohort traditionally viewed as the most resilient.
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