Wall Street’s Bitcoin Sentiment Has Shifted to Skepticism, Says Galaxy Digital’s Alex Thorn

Recent shifts in Wall Street’s sentiment toward Bitcoin have sparked skepticism after a strong long trade unraveled last year. Alex Thorn, head of research at Galaxy Digital, attributes this change to a lack of demand and a struggle for fresh narratives in the market, rather than conspiracy theories. Despite the negative sentiment, Thorn maintains Bitcoin’s fundamental value remains intact, emphasizing that long-term holders selling their assets is a natural part of market dynamics.

Key Takeaways

Wall Street’s view of Bitcoin has shifted from optimism to skepticism.
The change is attributed to depleted demand and long-term holders selling their assets.
Thorn disputes claims that specific firms are undermining Bitcoin’s value.
He argues the selling of Bitcoin by long-term holders is a healthy market behavior.
The narrative that Bitcoin will realize its “digital gold” potential remains at the forefront.

Bitcoin Sentiment On Wall Street Has Turned Negative, Galaxy’s Thorn Says

Wall Street’s Shift in Outlook on Bitcoin

According to Alex Thorn, the head of research at Galaxy Digital, Wall Street’s perception of Bitcoin has changed from a state of excitement to one of serious doubt. In a recent interview on the podcast What Bitcoin Did, Thorn explained that this shift is not due to conspiracy theories or a single negative event but rather stems from a lack of demand and significant selling by long-term holders, leaving the market in search of new stories to embrace.

Thorn dismissed the idea that firms like Jane Street are responsible for Bitcoin's recent downturn, referring to such claims as “Twitter cope.” He asserted that concerns are less about manipulation and more about the overall frustrations surrounding Bitcoin’s price movements. “What do we think the actual incentive would be for them to suppress the price?” Thorn questioned, highlighting the scale of Bitcoin as a multi-trillion dollar asset and the challenges in manipulating free markets.

Understanding Why Wall Street May Be Misguided About Bitcoin

Thorn provided a deeper analysis of the trend. From late 2024 leading up to the recent US elections, Bitcoin was seen as the “most popular trade in the world.” However, capital has recently shifted toward other investments, including AI-related stocks, semiconductor companies, energy sectors, and even gold, causing Bitcoin’s momentum to diminish.

Moreover, Thorn noticed that long-term holders have been actively selling their Bitcoins during periods of strength in the market. He described this phenomenon as a structural selling process rather than a cause for alarm. According to Thorn, older holders realizing profits marks an important phase in Bitcoin’s maturation, rather than signaling failure.

Thorn framed the distribution by “whales” as advantageous for the market in the long term. “Technically you want more selling. You want it distributed to people who buy it at a higher cost basis,” he noted. This indicates that significant buyers are willing to acquire Bitcoin at elevated prices, which he views as a crucial sign of increasing adoption.

Despite acknowledging the negative sentiment among investors—especially professionals—Thorn pointed out that Bitcoin’s inability to act as “digital gold” since September has negatively impacted the expectations of many investors. He remarked that Wall Street may have taken this label too literally. “We didn’t mean it was going to trade with a high beta to GLD,” he explained.

He maintained that the difference between Bitcoin's perceived function and its actual trading behavior is what creates a valuable opportunity for investors. This disparity has contributed to a souring in institutional sentiment, coinciding with growing macroeconomic concerns.

Thorn also highlighted issues surrounding artificial intelligence, noting that investors are anxious about AI's potential to either fail in substantiating large capital expenditures or succeed to a degree that disrupts job markets. If stock markets decline further due to these uncertainties, Bitcoin may find it challenging to maintain its resilience.

However, Thorn emphasized the distinction between short-term sentiment and long-term beliefs. “We really should focus on explaining its fundamental purpose and use cases and value to a holder of Bitcoin as the reason that it goes up,” he stated, urging investors to rely on their understanding of Bitcoin’s technology rather than outside expectations.

In conclusion, while Wall Street’s mood has turned pessimistic, Thorn believes that the ongoing narrative focuses on whether more investors will recognize Bitcoin as a stable store-of-value asset rather than just another macroeconomic trade. As of writing, Bitcoin's price stands at $66,109.

Bitcoin price chart Bitcoin closed below the 200-week EMA, 1-week chart | Source: BTCUSDT on TradingView.com