Large institutions have sold more than 236,000 bitcoins over the past two months, or almost $5 billion worth of the crypto based on bitcoin's recent price, as it trades almost 70% lower from its peak last November.
Such institutions include Luna Foundation Guard, Tesla (TSLA) , and bitcoin miners, among others, Vetle Lunde, analyst at Arcane Research wrote in a recent report.
Bitcoin is trading at around $21,007, down 4.5% over the past 24 hours, according to CoinDesk data.
In May, when TerraUSD, now TerraClassicUSD, a stablecoin that was supposed to trade 1 to 1 against US dollars, fell off its peg, Luna Foundation Guard sold more than 80,000 bitcoin in its reserves to defend it.
Meanwhile, as crypto miners faced increasing pressure on their top lines, they sold 4,556 and 14,600 bitcoin in May and June, respectively, Lunde noted.
In the second quarter, Tesla sold 75% of its bitcoin holdings, as the company aimed to maximize its cash position due to uncertainties around China's covid lockdowns. Arcane estimated that Tesla sold roughly 29,060 BTC at an average price of $32,209 during the period.
The bankruptcy of hedge fund Three Arrows and crypto lender Celsius also put selling pressure on bitcoin, as the crypto market suffered from contagion. What's more, in June, the Canadian Purpose Bitcoin ETF saw an outflow of more than 24,500 bitcoin, or roughly of half of its asset under management, in a day.
Forced selling has mostly calmed down, noted Lunde. "We will likely slump, pump, and dump in choppy conditions in the coming period, and macro and correlations will possibly resume being the key force of the market," he wrote. "However, the reduced presence of dollar-indebted institutions (i.e Tesla and miners) might contribute to lifting some of the correlation forces."