The price of Bitcoin is approaching the historic mark of $100,000, but the differences within the market are becoming more and more obvious. On the one hand, the crazy buying of institutional funds has pushed the market to a high point; on the other hand, long-term holders choose to sell at high prices, making the upward path of the market full of resistance. Faced with this game between "institutions and big investors", what will happen to the market in the future?
Since Trump was re-elected as the US President, ETFs have significantly increased their holdings of Bitcoin. However, the main force driving the rapid rise in Bitcoin prices recently is not ETFs, but MicroStrategy. In November 2024, MicroStrategy increased its holdings of 130,000 Bitcoins in a single month, with a total amount of up to US$12 billion. This move consolidates its position as the "largest institutional holder of Bitcoin" and also demonstrates its continued bullish strategic determination. MicroStrategy currently still has a financing capacity of more than US$10 billion and will continue to expand its holdings in the future.
But despite the continuous influx of institutional funds, the price of Bitcoin has failed to successfully break through the $100,000 mark. One of the reasons is that the collective selling of long-term holders (LTH) has increased market pressure. According to Glassnode's on-chain data, the monthly selling volume of Bitcoin reached 366,000, the highest level since April 2024. Among them, investors who hold coins for 6 to 12 months are the main selling force, with an average daily selling volume of 25,600. This large-scale selling behavior usually indicates that some investors believe that the price is close to the stage top and choose to take profits.
This is not the first time that long-term holders have sold off their holdings in large numbers. Historically, whenever this group sells off their holdings in large quantities, the market usually faces an adjustment. However, this time is different from the past - the addition of institutional funds has significantly enhanced the liquidity and resilience of the market, which may be able to offset some of the impact of the sell-off.
According to previous cycles, the selling of long-term investors often marks the top of the market, but will the deep involvement of institutional funds change this rule? Bitcoin's appeal to retail investors is gradually declining. As prices climb, the wealth effect of retail investors weakens, and their willingness to take over is obviously insufficient. At the same time, the game between institutions and large investors has shifted more to the derivatives market. In the past two months, Bitcoin's contract holdings have doubled to about US$65 billion, and trading in the options market has become increasingly active.
StarEx exchange analysts believe that the fluctuation of Bitcoin prices is no longer driven solely by the supply and demand relationship in the spot market, but is closely related to the trading dynamics of the derivatives market. Therefore, institutions take over the chips of large investors in order to control the pricing power of the crypto market in the future, thereby controlling the entire crypto market.
The crypto market is in a healthy bull market. Ethereum founder Vitalik (V God) and Binance founder CZ have recently emphasized that the crypto industry needs to go beyond the simple "coin issuance" and "exchange" model and develop more meaningful applications. Vitalik pointed out that the crypto industry has lacked innovative applications for ordinary users in the past few years, and the only successful case is decentralized finance (DeFi) because it can create wealth for users. However, the situation has changed since the beginning of this year. The industry's technical foundation has gradually matured, and applications suitable for ordinary users have begun to emerge.
For example, the Ondo protocol enables ordinary users to invest in U.S. bonds in the form of blockchain through the tokenization of RWA (real world assets), and this model has been supported by traditional financial giants such as BlackRock. In addition, some innovative projects have shown certain potential for success despite controversy. For example, projects such as Pump and Polymarket combine gambling with blockchain. Although there are constant controversies, they have attracted a large number of users and demonstrated the actual value of blockchain in specific fields.
StarEx exchange analysts believe that after the price of Bitcoin breaks through $100,000, its wealth effect may no longer be significant for most ordinary investors. However, this does not mean that retail investors have completely lost their opportunities. On the contrary, retail investors can find real investment value in the ever-innovating blockchain ecosystem by paying attention to industry fundamentals and long-term trends. For example, the tokenization of RWA and the payment and trading functions of stablecoins have found a practical foothold for blockchain technology. For retail investors, instead of chasing short-term hot spots, it is better to focus on projects that can provide long-term value. In the future, only in projects where fundamentals continue to strengthen can retail investors gain real wealth appreciation opportunities.
