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New research from VanEck shows that Bitcoin’s price decline is not caused by long-term holders. Instead, mid-cycle traders—those who last moved their coins three to five years ago—have been reducing their holdings.

Their supply has dropped across all observed time periods. Over the past two years, this group’s holdings declined by 32%. These movements suggest that these investors may be exiting positions they took during prior market cycles.

In contrast, long-term holders—who last moved their coins over five years ago—continue to accumulate. These wallets have added approximately 278,000 BTC in the past two years. This group has shown minimal churn and appears committed to holding, even through price volatility.

Retail Fear and ETP Outflows Add to Pressure

Bitcoin exchange-traded products (ETPs) also saw a drop in holdings. Since October 10, ETPs have recorded outflows of 49,300 BTC. This represents around 2% of total assets under management for these products.

VanEck analysts suggest these outflows may be linked to retail uncertainty amid changing expectations around interest rates and macroeconomic shifts. The fear-and-greed index for Bitcoin has dropped to its lowest since March 2025. This shift aligns with recent volatility related to tariff announcements and broader market instability.

Large Holders Show Mixed Behavior

Wallets holding between 10,000 and 100,000 BTC reduced their supply over the last 6 to 12 months. Their balances fell by 6% in six months and 11% over the past year.

However, mid-sized holders—those with 100 to 1,000 BTC—absorbed this reduction. Their holdings increased by 9% in six months and 23% over 12 months. Recent data shows that some large cohorts have started buying again. The 10,000–100,000 BTC group increased holdings over the past 30, 60, and 90 days.

VanEck noted that “some large cohorts have become net buyers again,” which may indicate the start of position rebuilding.

Futures Market Reset Adds to Downward Pressure

Bitcoin’s futures markets have experienced a rapid reset. Open interest in perpetual contracts fell by 19% in just 12 hours during the recent selloff. Since October, open interest has declined 20% in Bitcoin terms.

Funding rates, a measure of trader sentiment in futures markets, dropped to their lowest levels since late 2023. Analysts mentioned that structured products and basis traders—those using long-spot and short-perpetual strategies—could be distorting the usual funding signals.

Despite the recent decline, VanEck suggests that current conditions resemble previous periods when tactical re-entry began. They added that while many traders have exited, long-term holders remain steady in their conviction.

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