Bitcoin Supply Shift: Is the Selling Storm Really Coming?

Renowned economist Peter Schiff has raised a notable concern about the cryptocurrency market: the flow of Bitcoin from long-term holders to new investors could trigger a larger wave of selling in the near future. On-chain data shows that in October, 400,000 BTC were transferred from “strong hands” — whales and early adopters — to new addresses, marking a significant shift in ownership structure.

Why Is This Shift Dangerous?

Schiff’s analysis indicates that this change is not merely a transfer of ownership. Experienced investors tend to have a resilient mindset and higher tolerance for volatility, while new market participants are more easily triggered by small price fluctuations. When a large amount of Bitcoin is concentrated in inexperienced hands, the likelihood of panic selling increases significantly, especially during market downturns.

According to CoinMarketCap, this redistribution of 400,000 BTC reflects substantial capital moving from established wallets to active addresses, a warning sign of upward selling pressure. Data from CryptoQuant similarly shows that inflows to exchanges remain high, indicating that large holders continue to reduce their positions.

Actual Impact on Bitcoin Price

At the end of October, Bitcoin fell below the $85,000 mark, partly due to selling pressure from whales. With current data showing BTC trading around $95.49K, the market has yet to overcome this concern. Schiff warns that if new investors witness significant losses and decide to panic sell, the price decline could surpass previous cycles.

However, analysts also point to a positive sign: institutional investors have absorbed a considerable portion of this selling pressure, potentially mitigating the negative impact of the personnel shift.

Guidance for Traders

To accurately assess market sentiment, traders should pay attention to key support levels and closely monitor on-chain indicators, especially Bitcoin distribution by wallet age. These data points can provide early clues about the likelihood of upcoming overwhelming sell-offs.

Industry analysts have confirmed Schiff’s view, suggesting that the current holder transition aligns with the historical pattern of the crypto market at the end of a cycle, where early adopters profit from newer investors. This is a normal expectation, but the strength of this pattern will determine whether we enter a severe downturn or just a regular correction.