Bitcoin’s Silent Exodus Hits Crypto as Long-Time Buyers Cash Out

Market Overview - Bitcoin has experienced a significant decline of nearly 30% after reaching a record high above $126,000, with long-term holders continuing to sell their assets [1][2] - The market is facing a "slow bleed" due to steady selling into thin liquidity, making recovery more challenging compared to leverage-driven sell-offs [4] Long-term Holder Activity - Since early 2023, the amount of Bitcoin that remained unmoved for at least two years has decreased by 1.6 million coins, valued at approximately $140 billion, indicating sustained selling by long-term holders [2] - In 2025, nearly $300 billion worth of Bitcoin that had been dormant for over a year has re-entered circulation, with recent data showing one of the heaviest distributions by long-term holders in over five years [3] Market Demand and Supply Dynamics - Demand from newly launched exchange-traded funds (ETFs) and crypto investment firms that previously absorbed selling pressure has diminished, leading to negative ETF flows and reduced derivatives volumes [5] - The market is now facing the same supply with fewer active buyers, contributing to the ongoing price decline [5] Recent Market Events - A significant pressure point occurred on October 10, when $19 billion in liquidations were recorded due to unexpected comments from US President Donald Trump, marking the largest single-day leverage washout in crypto history [6] - Following this event, traders have retreated from derivatives markets, showing few signs of recovery [6] Investor Sentiment - Some industry executives view the selling by long-term holders as a normal reaction, given that many have realized substantial gains despite the recent downturn [6] - The head of Coinbase Global Inc.'s Singapore operations noted that it is natural for long-term holders to distribute their assets when they have seen gains of 1,000x to 10,000x [7]