Whales Dump 500K Bitcoin to Institutions – Here’s Why the Power Shift Matters in 2025

Bitcoin’s playing field just got a seismic shake-up. Half a million BTC—yes, half a million—changed hands from whales to institutional buyers. The crypto old guard is cashing out. Wall Street’s new sharks are moving in.

Who’s buying? Hedge funds, family offices, and maybe even that ETF you keep hearing about. Who’s selling? The OGs who’ve been sitting on generational wealth since BTC was pizza money.

This isn’t your 2017 bull run. The institutions aren’t here to HODL—they’re here to trade. Buckle up for volatility with a side of ‘regulated’ irony.

What to Know:

• Large Bitcoin holders have sold more than 500,000 coins worth over $50 billion in the past year
• Institutional investors now control approximately 25% of all Bitcoin in circulation, up from minimal holdings in 2020
• Bitcoin's volatility has dropped to two-year lows as the market transitions from speculative trading to institutional allocation

The Great Bitcoin Selloff

Over the past year, Bitcoin whales have offloaded more than 500,000 coins valued at over $50 billion at current prices, according to data compiled by 10x Research. This massive selloff roughly equals the net inflows into US exchange-traded funds since their approval. The figure also approaches the $65 billion accumulated over five years by crypto treasury pioneer Michael Saylor and his firm, now known as MicroStrategy.

Many of these whales trace their holdings back to Bitcoin's earliest cycles, when the cryptocurrency traded far below current levels.

Some whales aren't simply selling their tokens outright. Instead, they're swapping coins for deals tied to the stock market, bypassing the open market entirely.

"What we're seeing is a churning in the base," said Edward Chin, co-founder of Parataxis Capital. "A less covered driver and potential reason for the churn and increasing network activity seems to be driven by whales converting their BTC into equity exposure through in-kind contributions of BTC into financing transactions tied to the public markets."

The power dynamic is shifting rapidly. Back in 2020, researcher Flipside Crypto estimated that about 2% of anonymous ownership accounts controlled 95% of the digital asset. Now institutions control about a quarter of all bitcoin in circulation.

Institutional Appetite Grows

While whales have been cutting their exposure, ETFs, treasury companies and other institutions have absorbed nearly 900,000 coins in the past year, according to 10x Research. These institutional players now hold about 4.8 million coins out of approximately 20 million Bitcoin in circulation.

The institutional influx has brought stability and legitimacy to the asset class. "Crypto is becoming less of an outlier and more established as a legitimate asset class," said Rob Strebel, head of relationship management at trading firm DRW, which includes crypto-focused arm Cumberland.

This shift toward institutional ownership has dampened Bitcoin's notorious volatility. A closely watched measure of price swings has declined to the lowest level in about two years, according to Deribit's BTC Volatility Index, which monitors 30-day forward-looking annualized expectations of volatility.

Some analysts now expect Bitcoin's appreciation to be capped at 10% to 20% annually. That's a dramatic change from 2017's almost 1,400% surge that pushed the token into mainstream consciousness. "Bitcoin is probably more like boring dividend stock over time," said Jeff Dorman, chief investment officer at Arca. "On average it goes higher every year, but by less and less amount."

After two consecutive years where Bitcoin's price more than doubled, the cryptocurrency remains stuck around levels reached at the start of 2025, despite President Donald Trump's pro-crypto agenda.

Market Risks and Warnings

Not everyone views this transformation positively. Some observers warn that institutions are providing the long-awaited exit ramp for whales, raising the risk that retail and retirement investors could be left holding the bag if crypto sentiment falters.

"The goal for a long time has always been to make Bitcoin a palatable asset for institutional investors to provide exit liquidity in volume so the whales could cash out," said Hilary Allen, a law professor at American University's Washington College of Law and long-time crypto skeptic.

One significant risk remains market imbalance. If Bitcoin whales resume selling at scale while institutional flows plateau, the market could tip into steep declines. Historical data shows that outflows of just 2% in 2018 and 9% in 2022 triggered Bitcoin price drops of 74% and 64%, respectively, according to 10x Research.

"We are nearing a point where the market is hitting its peak," said Fred Thiel, chief executive officer of Bitcoin miner MARA Holdings Inc., which has yet to sell any of its Bitcoin holdings. "My personal belief, however, is we are in a very different market dynamic today."

The picture remains incomplete, as not all whale activity is visible on the blockchain. Bitcoin could prove volatile again if new market catalysts emerge.

Market Transformation Continues

The shift from anonymous whales to institutional allocators may help sustain the current market dynamic for an extended period. "This can go on for a long time — years," said Markus Thielen, CEO of 10x Research. "It's more of a slow grind, where Bitcoin becomes more of a 10%-20% asset."

The transformation represents a fundamental change in Bitcoin's identity. What began as a high-octane speculative trade is evolving into what some analysts describe as a slow-burn allocation suitable for retirement portfolios.

Closing Thoughts

The massive transfer of Bitcoin from anonymous whales to institutional investors represents a historic shift in the cryptocurrency market. While this transition has brought stability and legitimacy to Bitcoin, it has also fundamentally altered its investment characteristics, potentially capping future gains while reducing the extreme volatility that once defined the digital asset.