The crypto market is under pressure as Bitcoin relies on institutional investors to absorb the recent selling pressure.
The current state of the Bitcoin market demonstrates that the cryptocurrency relies on the support of institutional investors to manage the selling pressure from short-term holders. The recent decline from its all-time high has heightened concerns about the role of institutional investors in maintaining market momentum. Historically, corrections of around 30% have often led to a market recovery, but current conditions suggest that deeper pockets have not yet fully absorbed the selling pressure.
Institutional investment, primarily driven by Bitcoin ETFs and corporate accumulations, has historically helped reduce the depth of pullbacks during this market cycle. Previous corrections ranged between 18% and 22%, indicating a trend toward shallower declines. However, the current 29.7% decline suggests that institutional support has weakened. Without renewed buying from institutional investors, Bitcoin could experience a prolonged period of price stabilization or further declines.
Market data shows that short-term Bitcoin holders are increasingly selling at a loss. When the price fell below $90,000, these holders incurred unrealized losses, which has historically been a catalyst for increased selling pressure. A particularly vulnerable group within these holders are the so-called “shrimps” – addresses that hold less than 1 BTC and tend to sell during recovery rallies after sustaining extended unrealized losses.
The cost basis trends of recent Bitcoin buyers illustrate the waning demand. In strong market conditions, the cost basis of those who acquired BTC in the last 7 to 30 days typically rises above that of those who bought 1 to 3 months ago, indicating a bullish market. However, this pattern reversed in the first quarter of 2025, as new entrants became hesitant to absorb the supply.
The Short-Term Holder Spent Output Profit Ratio (STH-SOPR) is a crucial indicator for assessing Bitcoin’s current selling pressure. Since Bitcoin fell below $95,000, the 30-day average of the STH-SOPR has remained consistently below one, indicating that most short-term investors are selling at a loss. These conditions have historically preceded local seller exhaustion, where weaker hands exit and stronger hands begin to reaccumulate.
The report highlights that the reactions of institutional investors will be crucial in determining the next phase of the market movement. A significant return of institutional capital could provide the necessary support for a recovery. Without renewed interest from deep-pocketed investors, Bitcoin’s price action could remain muted, characterized by continued trading in a tight range or further decline.
TheBitcoinNews.com – Bitcoin News source since June 2011 –
Virtual currency is not legal tender, is not backed by the government, and accounts and value balances are not subject to consumer protections. TheBitcoinNews.com holds several Cryptocurrencies, and this information does NOT constitute investment advice or an offer to invest.
Everything on this website can be seen as Advertisment and most comes from Press Releases, TheBitcoinNews.com is is not responsible for any of the content of or from external sites and feeds. Sponsored posts are always flagged as this, guest posts, guest articles and PRs are most time but NOT always flagged as this. Expert opinions and Price predictions are not supported by us and comes up from 3th part websites.
Advertise with us : Advertise
For the latest cryptocurrency news, join our Telegram!
