Bitcoin Price Stagnates as Institutional Buyers Absorb 1.5 Years of Supply

Long-term Bitcoin holders have been selling their positions to institutional investors since the launch of spot Bitcoin ETFs in early 2024. This trend has contributed to the stagnation of Bitcoin prices, despite the growing interest from corporations in adding Bitcoin to their treasuries. The market is currently experiencing a unique dynamic where new Bitcoin treasury companies are absorbing the supply from long-term holders, potentially setting the stage for a sustained accumulation phase.

Charles Edwards, founder of Capriole Investments, noted that the amount of Bitcoin acquired by this cohort in the last two months has completely consumed all of the Bitcoin unloaded by long-term holders over the last 1.5 years. This highlights a significant shift in Bitcoin ownership patterns, with institutional investors playing an increasingly dominant role.

The introduction of spot Bitcoin ETFs in January 2024 has sparked a new wave of institutional interest, particularly from Bitcoin treasury companies. These entities are actively accumulating Bitcoin, creating what Edwards describes as a “huge flywheel buying frenzy.” This phenomenon is gradually overshadowing the initial excitement surrounding ETFs themselves. Edwards’ analysis reveals that the six-month holder cohort—representing newer institutional buyers—has surged dramatically. This group’s acquisitions have effectively absorbed the supply released by long-term holders, who have been offloading their Bitcoin positions since the ETF launch. The net effect is a market where institutional demand is stabilizing supply-side pressures, potentially laying the groundwork for future price appreciation.

Recent entrants into the Bitcoin treasury space include diverse corporate players such as Cardone Capital, ProCap Ventures, Panther Metals, and Green Minerals. Their involvement underscores a growing trend of companies integrating Bitcoin into their balance sheets as a strategic asset, signaling confidence in Bitcoin’s long-term value proposition.

Despite the institutional accumulation trend, short-term market sentiment remains cautious. Jeff Mei, COO of BTSE exchange, notes that traders are currently engaging in profit-taking ahead of the July 9 tariff deadline, anticipating potential volatility if trade negotiations falter. This hedging behavior reflects broader macroeconomic uncertainties impacting crypto markets. Mei also points out that while corporate Bitcoin treasury adoption is increasing, accumulation is a gradual process. He expects market stabilization over the coming year as more long-term holders enter the market, balancing out short-term fluctuations.

Similarly, Han Xu from HashKey Capital highlights that investors are closely monitoring upcoming US macroeconomic data and policy developments, including trade deal updates and the progress of the federal budget bill. These factors represent key catalysts that could either reinforce or disrupt the current bullish momentum.

Bitcoin’s price has remained largely sideways since surpassing the $100,000 mark in early May 2024, oscillating between $102,000 and $110,000. This consolidation phase reflects a market digesting recent inflows and awaiting clearer macroeconomic signals. Notably, US spot Bitcoin ETFs have attracted over $3.2 billion in inflows over the past two weeks without any outflow days, indicating robust and sustained institutional interest. Concurrently, the number of Bitcoin treasury companies continues to rise, further supporting demand fundamentals.

At the time of writing, BTC was trading near $108,750, encountering resistance that has so far prevented a breakout above this level. Market watchers are keenly observing whether Bitcoin can overcome this barrier to resume its upward trajectory.

The interplay between long-term holder selling and institutional accumulation via spot ETFs and treasury companies has created a nuanced Bitcoin market environment in 2024. While price action remains range-bound, the growing presence of corporate investors absorbing supply suggests a potential foundation for future growth. Market participants should monitor macroeconomic developments and institutional activity closely, as these factors will likely dictate Bitcoin’s next significant move.