The founder of Capriole Investments, Charles Edwards, has highlighted that Bitcoin is currently experiencing the most aggressive institutional net selling in its history. Edwards used spot exchange-traded funds (ETFs) and treasury companies as a proxy to gauge institutional activity, as these are the regulated, indirect routes traditional institutions typically use to gain exposure to BTC.
A chart shared by Edwards shows the monthly rate-of-change (ROC) in combined ETF and treasury holdings has plummeted into negative territory recently, indicating significant capital outflows. While treasury companies alone remain slightly positive, likely due to continued accumulation from MicroStrategy, spot ETFs have sunk deep into the red. The Net Institutional Buying indicator, which compares the ROC of these entities against new Bitcoin mined, has collapsed to a record low of -319%.
"Most aggressive institutional net selling of Bitcoin EVER this last week," Edwards stated. He pointed to the emerging Quantum Computing threat as a potential reason for this shift. In a research piece last week, Edwards argued that the risk of quantum computers breaking into old, vulnerable BTC wallets could be "discounting" the asset's value by an estimated 20% today, with this discount increasing each year the network remains un-upgraded.
This sentiment is echoed by market maker Wintermute, which notes Bitcoin continues to struggle below $70,000, with fading institutional appetite evident. Bitcoin is behaving like a high-beta asset, closely tracking large-cap altcoins and tech-sensitive trades. Wintermute's analysis points to broader structural macro forces replacing headline-driven volatility, with Federal Reserve policy losing its prior influence. Two key themes are reinforcing this shift: a reassessment of AI-driven company valuations and deglobalization, which introduces fragmented supply chains and geopolitical risk into long-term asset pricing.
Institutional demand remains weak. Futures premiums are low, options data shows increased demand for downside protection, and open interest has been falling since October. Trading desks report more selling than buying, with most activity focused on hedging rather than betting on a rebound. Funds are also leaving Bitcoin ETFs, adding further pressure. Bitcoin is currently trading like a high-risk tech stock in a market that favors defensive assets like gold and commodities. At the time of writing, Bitcoin is trading around $62,300, down nearly 7% over the past week.
