BTC has been falling for 7 consecutive days, breaking below 88,000. Why are institutions and whales reducing their positions?

Bitcoin has once again fallen below a key support level amid short-term correction pressures. According to the latest news, BTC has dropped to 87,989 USDT, hitting a recent low. But what is more noteworthy is the actions of market participants: institutions are reducing holdings, whales are adjusting their positions. What does this reflect?

Downtrend Confirmation, Multiple Signals Appear Simultaneously

Price Movement and Technical Analysis

BTC’s performance over the past week has been less than optimistic. According to data, it has declined 3.82% in the past 24 hours and a total of 6.34% over the past 7 days, with the decline gradually widening. In contrast, the 1-hour decline is relatively mild (0.15%), indicating potential short-term rebound space.

From a market size perspective, BTC’s market cap remains at $1.79 trillion, accounting for 59.22% of the total crypto market capitalization. This suggests that market confidence in Bitcoin’s fundamentals remains intact. The 24-hour trading volume reached $5.128 billion, up 25.82% from the previous day. The rising volume coupled with falling prices usually signals increasing selling pressure.

Geopolitical risks have become a recent main factor

According to reports, this decline is closely related to escalating geopolitical risks. The former US president announced new tariffs on European countries, triggering a comprehensive adjustment in risk assets, with funds flowing into gold and other defensive assets. As a risk asset, the crypto market naturally became a target of correction. This not only caused BTC to fall, but Ethereum also dropped below $3,200, and the entire crypto market experienced over $800 million in long liquidations.

Market Participants Are Quietly Adjusting Positions

Institutional Movements

Actions at the institutional level best reflect market sentiment. According to reports, Coinbase Institutional has transferred 556 BTC to unknown wallets over recent periods, worth approximately $51.68 million. More notably, the performance of Bitcoin spot ETFs: a net outflow of about 1,106 BTC (around $103 million) in a single day. Although this outflow seems significant, over seven days, Bitcoin spot ETFs still saw a net inflow of 18,138 BTC (about $1.68 billion), indicating that overall institutional attitude remains accumulation-oriented, with short-term risk management in play.

Whales’ Rebalancing Signals

On-chain data more clearly reflects the intentions of large holders. According to reports, a well-known on-chain whale has been continuously reducing its BTC short positions for profit in the past hour, with a total reduction of about $1.18 million. Interestingly, this whale is shifting strategy: moving away from high-leverage crypto shorts (ETH, BTC, SOL) towards increasing holdings in on-chain stocks and gold assets. Its holdings related to stocks and gold on-chain have reached $24.35 million, making it the largest on-chain short position in gold.

This shift indicates a reassessment of the current risk environment by market participants. They are not entirely bearish on the crypto market but are turning to more stable asset classes amid rising geopolitical risks.

Overall Market Status and Future Observation

According to reports, the entire crypto market sector has experienced a correction, with 24-hour declines generally between 2% and 9%. The GameFi sector led the decline with 8.58%, Layer1 dropped 4.80%, and DeFi fell 5.97%. This suggests that the decline is not isolated to a single coin or sector but a systemic adjustment across the entire market.

From support levels, technical analysis indicates that key support zones for BTC are around $92,690 and $93,683. If the price can stabilize within this range, a rebound could target $96,442 and $97,267.

Summary

BTC breaking below $88,000 is not accidental but the result of multiple factors: escalating geopolitical risks leading to risk asset adjustments, institutions managing risk, and whales rebalancing their positions. However, it’s important to note that the seven-day net inflow for institutions remains positive, suggesting that the overall market confidence in Bitcoin has not been completely shaken. In the short term, the key is whether BTC can hold around $92,690. If it can defend this support, there is still room for a rebound. Meanwhile, close attention should be paid to geopolitical developments, as they could be a crucial variable influencing subsequent market trends.