Who is selling Bitcoin in 2024?

In this article we try to explain the reason why Bitcoin cannot surpass its all-time high in 2024.

The price of Bitcoin (BTC) fell today to $65,000 (USD), sharpening last week’s retreat, which exhibits greater supply. “Who the hell is selling?”, questioned the renowned analyst Willy Woo in this context.

Investors in Bitcoin exchange-traded funds (ETFs) in the United States ended the last week with outflows of $580 million. This comes after they recorded four consecutive weeks of capital inflows, as seen below.

In this way, ETF investors have caused the drop in BTC last week. However, it should be noted that, despite this, these instruments have accumulated USD 15 billion since their launch five months ago. Therefore, beyond their recent selling pressure, they contributed practically all year to the currency’s rise.

It should also be taken into account that these investors are not the only ones impacting the price. “2024 brought a large number of commentators analyzing ETF flows, as if that was all that mattered,” said Willy Woo. “What matters is the total supply and demand,” he added.

The OGs and Bitcoin whales facilitated the price drop

The analyst emphasizes that those who are selling are the OGs (original gangsters), a term used to refer to the first users of Bitcoin. He points out that they have 10 times more Bitcoin than the ETFs and sell in all bull markets, as shown in the next graph.

“In the old days, BTC was on an exponential run because the only sellers were a handful of OGs and an even smaller number of miners with their freshly mined coins,” explained Willy Woo. In contrast, he notes that today the market is broader.

The trade is made up of Bitcoin spot, which involves holding the currency, and paper, which refers to indirect possession of the currency through derivatives such as futures, options, and ETFs.

Woo recalls that the bear market of 2022 was dictated by an avalanche of paper BTC when spot holders really did not sell. On the other hand, in the current bull market, when the paper supply in exchanges increased, there were times when the price did not rise. This means, as shown below, that the rise has been mainly influenced by spot trading.”

In light of this, the analyst concludes that it is not a good idea to focus solely on ETF purchases. He highlights that on-chain data, derivatives, and technical price action contribute to the supply and demand landscape.

As reported by CriptoNoticias, the selling pressure on Bitcoin in the last two weeks has also been influenced by whales. These investors, so called because they own more than 1,000 BTC, have sold more than 50,000 BTC in such a period.

Something that exacerbated this scenario last week was the FOMC, the committee of the United States Federal Reserve (Fed) that defines monetary policy. It anticipated only one interest rate cut for 2024, below the projection of three reductions as said months before and two as the market expected.