Key Takeaways
Why are retail Bitcoin holders declining despite record highs?
Addresses holding under 100 BTC have dropped to cycle lows, showing that small traders are either priced out or disinterested.
Who’s driving this Bitcoin cycle?
Entities holding 100–1,000 BTC add over 10K BTC daily, and ETF holdings top 620K BTC ($76.9B) — making this a whale-led cycle rather than a retail-driven one.
Bitcoin [BTC] rallied to a new all-time high of $125,725 before retracing to $123 859 as of this writing.
Although the king coin traded at record high levels, some investors, especially small-scale ones, remained unsettled with the market prospects.
Bitcoin retail holders decline to cycle lows
Surprisingly, while Bitcoin has rallied to record-breaking levels this cycle, retail traders have failed to show any enthusiasm.
According to CryptoQuant analyst Darkfost, addresses holding less than 100 BTC have become increasingly scarce in the market.
Source: Checkonchain
A breakup from the previous market patterns, this cycle has exhibited a unique character, where retail participation has remained extremely weak.
In fact, the Bitcoin supply held by retailers has declined since the previous bear market, even though this cycle has turned most profitable.
The question is, are retail traders uninterested or unable?
Retail displaced by high net worth
AMBCrypto observed that retail absence is primarily driven by increased demand from large players, both whales and institutions.
In fact, BTC, with its $120k price range, has become increasingly expensive for small-scale traders.
Source: Checkonchain
Amid this gap, whales and institutions took over. For starters, addresses holding 100 BTC to 1k BTC have dominated this cycle, increasing over 10k BTC daily.
On the 6th of October, for example, sharks added over 124k, BTC signaling strong demand from high-net-worth investors.
On top of that, institutional investors have turned more aggressive during this cycle than ever before.
Since the launch of Bitcoin ETFs in early 2024, institutions have found a way to invest in BTC. In fact, through ETFs, institutions own 620.95k BTC worth approximately $76.9 billion.
Source: CoinGlass
Take the past week, for example, Bitcoin spot ETFs saw a net weekly inflow of $3.24 billion. This marked the second-highest weekly inflow in history.
Source: SosoValue
Such a massive inflow suggests that this cycle is different from previous ones. Currently, retail is unable to hold on while large entities have become key drivers.
What does it mean for BTC?
Notably, Bitcoin has experienced significant growth and has become a speculative asset. With this maturity, retail traders are left with little room.
Significantly, large holders, either whales or institutions, have popularized long-term storing, displacing retail activity.
Therefore, for BTC, declining retail traders is a good thing; when retail dropped, BTC has grown to reach historical levels.
Thus, large entities demand positions in Bitcoin for more growth, with less speculative dumping associated with retail. Therefore, if these conditions continue to hold, BTC will again retest its ATH and make another high.
