Bitcoin Capital Inflows Have Dried Up, Says CryptoQuant CEO

As Bitcoin consolidates around $94,000, capital inflows into the cryptocurrency have come to a halt. CryptoQuant CEO Ki Young Ju highlighted that the introduction of diverse liquidity channels and long-term holding strategies by institutions has fundamentally changed traditional market cycles.

Key Takeaways:

Capital inflows into Bitcoin have ceased, leading to a period of consolidation around $94,000.
The traditional market dynamics driven by whale selling have shifted due to increased institutional holdings.
Whale activity has decreased, indicating a stabilized market despite recent price volatility.
Retail investors are largely absent from the current recovery, suggesting limited demand.
Signs of institutional investment recovery are emerging, particularly in US spot ETFs.
Opinions on Bitcoin's future vary, with some predicting sharp price targets and others forecasting deeper corrections.

Capital Inflows into Bitcoin Have Dried Up, Says CryptoQuant CEO

This change signifies a break from historical trends, where large sell-offs by whales typically led to crashes driven by retail investors. Instead of experiencing significant corrections of 50% or more as in past bear markets, the market seems poised for an extended period of sideways trading.

Ju pointed out that institutional holdings, notably MicroStrategy’s massive 673,000 BTC stake, have disrupted the usual cycle of whale selling that influenced market dynamics in the past. Consequently, investments have shifted towards traditional stocks and precious metals, leading to what Ju describes as “boring sideways” price movements in the coming months rather than sharp downward volatility.

Whale Activity Suggests Market Stability Despite Price Fluctuations

Despite Bitcoin's recent uptick from lower levels, activity among whale investors has decreased rather than increased. This trend contradicts historical behavior, which often saw heightened exchange activity from large holders prior to price declines.

According to data from CryptoQuant, whale trading activity remains low even after Bitcoin's rebound, indicating minimal selling pressure from major holders. This situation aligns with analysts’ views of a “structurally healthy” market.

Bitcoin Capital Inflows - Bitcoin Exchange Whale Ratio Chart

Meanwhile, retail investors have notably been absent during this recovery phase. The 30-day change in retail demand for Bitcoin remains strongly negative, as noted by CryptoQuant analyst Maartunn.

Bitcoin Capital Inflows - BTC: Retail Investor Demand 30D Change Chart

“Retail is still missing in action,” Maartunn remarked, stressing that the general public hasn’t returned to the cryptocurrency market despite recent stabilization in prices.

With both retail and large holders showing hesitance, the market appears to be in an unusual state of low engagement. Recently, Bitcoin dropped below $90,000 and filled its first CME gap, raising concerns about the potential to slide further toward the $88,000 range.

Signs of Recovery in Institutional Investment

Looking at on-chain metrics, Glassnode has observed that Bitcoin is entering 2026 after significant drawdowns and consolidation. This analysis indicates a decline in profit-taking pressures and a structural stabilization around the current low price levels.

“In late December 2025, Realized Profit (7D-SMA) dropped significantly to $183.8 million per day, down from levels exceeding $1 billion per day observed through much of Q4,” stated the analytics firm. This sharp reduction in realised profits suggests that selling pressure from larger holders is diminishing.

Bitcoin Capital Inflows - BTC: Realized Profit by Age Chart

Furthermore, net flows into US spot ETFs have surged again after a dip in late 2025, and futures open interest has stabilized and begun to rise following a contraction from previous highs above $50 billion.

“Positive signals are becoming more frequent, suggesting that ETF participants are moving from being net sellers to marginal buyers,” Glassnode noted, signifying a promising trend in institutional spot demand.

Bitcoin Capital Inflows - US Spot ETF Net Flows Chart

Importantly, a significant reset in options open interest cleared over 45% of outstanding positions post the December 26 expiry, alleviating previous hedging pressures.

“Open interest decreased from 579,258 BTC on December 25 to 316,472 BTC following the expiry,” Glassnode explained, asserting that this reset offers “a clearer understanding of sentiment, as new positions reflect current premium activity rather than inherited exposure.”

Additionally, it was noted that dealer gamma has switched to a short position between $95,000 and $104,000, with new options trends leaning increasingly toward call options rather than protective puts.

Bitcoin Capital Inflows - Options Gamma Exposure Chart

Overall, analysts concluded that corporate treasury demand continues to act as a stabilizing force beneath current price levels, although this support remains more sporadic than consistently robust.

Shifts in Capital Allocation and Future Insights

In an interview with Cryptonews, VALR CEO Farzam Ehsani linked Bitcoin's current consolidation to capital being redirected into precious metals, two of which—gold and silver—have seen rises of 69% and 161% respectively over the past year.

“Capital inflows into Bitcoin and Ethereum are likely when the rally in precious metals begins to slow,” Ehsani projected, setting base-case targets of $130,000 for Bitcoin and $4,500 for Ethereum in Q1 2026 as precious metals momentum wanes.

Conversely, early Bitcoin investor Michael Terpin brings a contrasting perspective, suggesting 2026 might mimic down years like 2014, 2018, and 2022.

“Following historical trends, we could see a bottom around $60,000 by early fall,” Terpin observed, albeit with a roughly 20% chance of an extended bullish cycle pushing prices to new highs before a final correction.

In this context, Ju encourages a long-term view on Bitcoin investment. He likens it to fine whiskey, asserting, “It takes at least four years to mature,” urging investors to consider holding periods of up to 16 years that extend until 2042, rather than focusing solely on short-term price fluctuations.