Major long-term holders are cashing out, raising concerns about volatility and the ability of new market participants to absorb selling pressure.
A sharp rotation of Bitcoin from long-term holders to newer investors is raising alarms among market analysts. Gold advocate Peter Schiff argues that this shift increases the risk of deeper drawdowns, as inexperienced buyers may struggle to hold during periods of volatility. With more than 400,000 BTC offloaded by whales in October, concerns are growing about whether the market can withstand continued selling pressure.
Bitcoin OGs Are Exiting — And It May Amplify Volatility
Peter Schiff said Bitcoin is “finally having its IPO moment,” suggesting the market has become liquid enough for early adopters to take profits. He warned that “Bitcoin moving from strong to weak hands not only increases the float, but means future selloffs will be bigger.”
The trend is significant: long-term holders, often referred to as “OGs,” have sold sizable positions, contributing to Bitcoin falling below $85,000. Market data shows that exchange inflows remain elevated, signaling that more holders may be preparing to sell.
Market strategist Daniel Rees explained that “when seasoned investors exit, the market becomes more vulnerable because new buyers lack conviction and react faster to fear.”
High-Profile Liquidations Add to Selling Pressure
The selling has not been limited to anonymous whales. In October and November, early Bitcoin holder Owen Gunden sold his entire 11,000 BTC stash, worth roughly $1.3 billion.
Investor and author Robert Kiyosaki also confirmed he sold all of his Bitcoin — valued at about $2.25 million — after buying at $6,000 and exiting near $90,000. Despite selling, Kiyosaki emphasized that he remains bullish, saying he plans to reaccumulate using cash flow from other businesses.
Bitfinex analysts say this wave of long-term selling, combined with leveraged liquidations in derivatives markets, is accelerating the current downturn.
Can the Market Absorb the Pressure?
Analysts remain divided. Some believe institutional adoption will continue to strengthen Bitcoin’s foundation. Bitfinex researchers argue that Bitcoin’s fundamentals remain attractive, pointing to demand from professional investors.
However, others warn that retail investors pose a major risk. Vineet Budki of Sigma Capital said, “Retail will likely sell at the first sign of trouble,” adding that this behavior could result in a 70% price drawdown in the next bear cycle.
The ongoing transfer of Bitcoin from veteran holders to less experienced buyers is reshaping market dynamics. With whales reducing exposure and retail sentiment remaining fragile, the coming months may test Bitcoin’s resilience as volatility intensifies and liquidity shifts.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.