Bitcoin’s Drop Below $60,000 Just the Beginning... Whales Exit While Retail Investors Keep Buying

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As Bitcoin (BTC) enters a correction phase, a stark polarization is emerging in the market: whales that move massive capital are offloading their holdings and exiting, while retail investors, buoyed by optimism, are aggressively accumulating—creating a potentially risky divergence.

According to crypto media outlet CryptoPotato on February 22 (local time), after reaching an all-time high above $126,000, Bitcoin plunged more than 50% from its peak, falling to around the $60,000 level on February 6. On-chain data analytics firm Santiment observed that during Bitcoin’s prolonged correction, the share of wallets holding between 10 BTC and 10,000 BTC declined by about 0.8%. This suggests that major capital players—the core driving force of the market—have been taking profits or managing risk amid the price decline.

In contrast, retail traders are moving in the opposite direction, continuing aggressive accumulation. The proportion of ultra-small wallets holding 0.1 BTC or less increased by 2.5% over the same period, reaching its highest level in nearly two years. Santiment analyzed that “without support from large stakeholders, accumulation driven solely by small investors has limitations in triggering a full-fledged price rebound.” Without significant capital inflows, any temporary rally is likely to face renewed selling pressure.

Painful outflows have also been confirmed in the Bitcoin spot ETF market. In the two weeks leading up to Bitcoin’s all-time high, approximately $6 billion flowed into spot ETFs. However, since the price decline began, weekly outflows have persisted. In particular, more than $3.5 billion exited over three consecutive weeks in early November, reflecting a sharp freeze in investor sentiment. Unlike Ethereum spot ETFs, Bitcoin spot ETFs have recorded net outflows for five consecutive weeks, becoming a major factor adding downward pressure to the market.

According to data aggregator SoSoValue, $1.33 billion was withdrawn in the week ending January 23, followed by an additional $1.49 billion in outflows the next week. Fortunately, over the past three weeks, net outflows have decreased to less than $360 million, indicating that selling pressure is somewhat easing. Nevertheless, the cumulative net inflow into Bitcoin spot ETFs has fallen significantly—from $62.77 billion in early October to $54 billion as of last Friday—marking substantial capital flight.

The Bitcoin market is currently moving sideways in a sluggish pattern, caught between the absence of major capital and the divided sentiment of retail investors. Santiment noted that for a trend reversal to occur, there must be a crossover point in the behavior of whales and retail investors. A renewed influx of large-scale institutional capital that can firmly support the market’s lower range is expected to be the key to price recovery.

*Disclaimer: This article is for investment reference only and we are not responsible for any investment losses incurred based on it. The content should be interpreted for informational purposes only.*