Bitcoin Institutional Behavior Reverses As Demand Metric Turns Red

The founder of Capriole Investments has highlighted how institutions have reversed course on Bitcoin recently, taking to selling once more.

As both of these represent a regulated off-chain route into digital assets, they tend to be the preferred mode of investment for the more traditional traders like institutions.

Now, here is the chart shared by the analyst that shows the trend in the Net Institutional Buying for Bitcoin over the last couple of years:

As displayed in the above graph, the Bitcoin Net Institutional Buying rose to a positive level during March and stayed there until very recently, indicating that demand from massive entities was pouring into the cryptocurrency.

The report showed that the CPI rose to 3.8% in April, which is the highest level seen in the US since May 2023. The high inflation rate could be why big-money entities have been pulling out of risk assets like Bitcoin.

It now remains to be seen how long the Net Institutional Buying will remain negative for. “Hard to get meaningful price improvement while this metric is in the red,” explained the analyst.

This level is lower than the highs seen after the February crash, but still notably elevated compared to last year’s figures. “This supply overhang is a structural feature of bear markets, typically resolved only as weaker hands capitulate,” said Glassnode.

Bitcoin has overall moved sideways over the last few days as its price is still floating around $77,300.