Topic: Are Institutional investors changing the Bitcoin price behaviour? (Read 349 times)

Trends and investor behavior will always change, nowadays many institutions invest in bitcoin so when they get a small increase they immediately sell, this is what is difficult to see the price skyrocketing significantly like a few years ago, in general of course this is more good because when the price is red there will be a buying action in large quantities so that it can keep it from dropping too much.

The whales always rule the market, it's a fact that you see in every market. Let's say, for example, we have some wallets addresses that have bitcoin locked on them for many years that has not been moved by the real owners, the moment the private key owner desire to spend from thus wallet always create this fear among holders and speculators that the early birds are trying to cash out, the whales will want to sell at the top and use the opportunity to buy at lower price maximizing their hodl and that's how the fear will naturally create a panic sell in the market.

Again, of what used is Bitcoin to institutional if they don't have the chance to buy on low price and  if the price of Bitcoin doesn't go up over time, try will do whatever they feel is good for them as long as their money is involved.

Centralized market will be regulated but the point is that the decentralized markets remain and those are the ones that need to be regulated. See every American cannot manage their own assets, unlike the rest of the world can. So they need some legal backing and clarity on these assets as per their narrative. Hence the need for regulation. I consider this as a good step overall for the long run for crypto. While this will mean a tougher situation for developers, it will also weed a large chunk of non-sense scams that keep on going around in this sector.

You cannot stay away from government's crackdown if you are living in their land. But it will be for our good only.

At the same time it is also to be noted that these large scale institutional investors serve as influencers in adoption of bitcoin. More the usage more will be the growth. When some institutional investor makes his entry it is also a kind of accumulation. When more such investors combine together the holding will form a large percentage of the total supply. This lets them manipulate the market to some extent and that is reason it how at times the price behaviour is being changed, but this don't make a big impact as people are well aware of such activities.

Yes, we can see higher manipulation the more money that will be injected in to this market. BTC is getting popular and expect that many new institutions will enter. What we are feeling now is not heavy but there is more heavier to come, let's brace ourselves if that event comes but if you already know what to do or you know their pattern already, you could worry less but you can go with flow with them and you will be just fine.

You are not going to lose but your going to earn some profit. For some they are not a problem but there are some that thinks the opposite. Those people are the ones that need to adjust because they are smaller.

When news began to emerge about some US companies starting to invest in Bitcoin, it seemed that this might be the beginning of something that would spread around the world and that big money would move in the direction of Bitcoin. Yet I don’t see that happening, and as things currently stand Bitcoin is behaving in the same pattern as after every past ATH, which again followed after every halving. We can discuss whether institutional investors have influenced the price not to be lower than it is today, but what we know for sure is that they have failed to reduce volatility.

Furthermore, the question arises whether it is realistic to call Bitcoin safe haven at all, although if we look at the long term, it is difficult to find someone who regretted investing in Bitcoin two or 5 years ago. When (if) greedy guys one day gain most of the BTC, of course, they will start playing their games in which the little man will not have much influence - but this is a problem that has existed for a long time since people started accepting Bitcoin as some kind of digital gold, not as a cryptocurrency.

I wonder if we are going to see higher manipulation than whatever we are feeling already about it but whales only do what is needful for their business and smaller buyers or individuals have to follow them by the chart. If you notice a huge buy in the chart that means to expect more buy and price will appreciate and that follows down too. I don't think institutional buyers are going to be a problem with the bitcoin behavior.

The main difference are the regulations, in a centralized market governments can set rules for economic actors to follow, we know they will try their best to find loopholes but at least in theory there are some impediments in their path so they cannot easily do this, in this market such a thing is not possible due to its decentralized nature, however I prefer it this way, this market is really free and we know that free markets will always outperform controlled markets, which in part explains the incredible growth we have seen in this market during the last decade.

Manipulation - that is definitely a risk for bitcoin and the crypto space.  Not necessarily institutional investors like MicroStrategy, Tesla, ....  but also possibly an association, rapidly changing price behavior is also part of the reason for this.

When it comes to manipulation then there would be no exemption whether you are dealing with centralized or decentralized things as long there's a market then there would be always the tendency that

these big guys would really be taking advantage on the market via manipulation which we should really be looking it upon and you should take your decisions carefully.

This market is a bit decentralized on which funds could really come and go easily without those hindrance compared on centralized platforms.

As you said most markets go through periods of manipulation, after all if an entity is big enough to do this then it would be naive to think they are not going to take advantage of it, however while in centralized markets rules and regulations are born to try to hinder this, in the market of cryptocurrencies that very same freedom that allows an actor to attempt to manipulate the price if they want allows another actor which is even more powerful to do the opposite and beat the manipulator at their own game.

If you feel that other markets are candidate to manipulation by institutions then bitcoin as well a candidate to them, we cannot do anything about that. Moreover, bitcoin market is a complete open market (it is like some countries stock markets do follow a practice of phasing their trading for few hours if market falls certain percentage within a day which is definitely not possible in bitcoin market), hence you cannot think about zero manipulations.

In my opinion, manipulations are just part of every market hence change of behaviour of fluctuations of bitcoin market due to intuitions is definitely normal one and we must need to get used to it as influence of intuitions will get more intensified in coming days in entire crypto space.

This couldn't be further from true. The larger players, ie institutional investors could divest from Bitcoin and sink the price because of the lack of mass adoption. Large part of the growth over the last two years were large investment firms and private companies dumping their assets into crypto.

Tesla isn't an institutional financial firm, but to get an idea of their influence, Elon Musk can send one tweet regarding Tesla's bitcoin stockpile, and it would send the price tumbling.


If the financial guys were to all pull out for whatever reason, the impact would be huge.

very well-said. i don't think we can consider the crypto market or btc market to be a safe haven for your investments. up until now, volatility is one major attraction why people are going into crypto. this is where they are taking their chances to earn good profits if you know what you're doing, but will suffer a loss if you made a mistake with your trading strategy. this is by no means can be categorised as safe haven.
on the other hand, institutional investors are giving some sort of assurance to crypto users that bitcoin will stay and continue to grow its market.

 Considering we just did a %10 in a very quick period of time and then a bit more later, do you think that it was all retail investors? I believe that this is the exact impact of the corporations who put money into crypto, all those hedge funds and companies and so forth that buys bitcoin could do it in big big numbers, like billions of dollars easily. Just the gamestop chaos showed us that big hedge funds could get together to have billions of dollars thrown out to garbage to show their power. So when they all buy at the same time, or even one big one buys, then the price could go up very quickly, then retail will see the pump and have FOMO and buy some more to increase it some more.

It all depends upon how much money is pumped into the market and if you consider the cryptocurrency market as an asset then they will not synchronize the global stock market to the cryptocurrency market, instead i expect them to hedge over the other in case of one market is tumbling and wise versa.

This is the most volatile market in the entire financial sector and unlike other markets where you can really understand certain market movements it is not possible to even predict when a market moved in the cryptocurrency space as it is purely speculative in nature and nothing else. You cannot call a speculative market a safe heaven according to any economic standards .

It is not on their best interests to do something like this, after all if they bought all the bitcoin around the world and bitcoin did not circulate as no one was using it as money then the whole reason for bitcoin to exist will be denied and then it would become useless, not that the scenario that you are putting forward will ever happen, after all the more the demand of something increases the higher its price, so it does  not mater how much money institutional investors may have, their dollars would buy less and less bitcoin if they tried to buy all the bitcoin that is in circulation.

This is serious question and a food for thought but the point is if any body can stop it? This is possible to happen but who could tell the degree of manipulation that can go on if it will be greater than the current manipulation or lesser but I know it that institutional hodlers are expects in business and all out for profit that means we could also see higher price because demand will increase when products not available.

We can't say that they are completely combined together forever. Even though we can't say they are irrelevant like you said, we also can't say that they are not independent ab it neither, and I believe that we are in a situation where they would be affected by each other but that is about it.

Prices are of course related to each other, when one does one thing the other follows and so forth but price is not the only thing in the world that we care about. I care about the decentralization, as long as the coin I buy is decentralized (funny enough, I own bnb.. go figure) then I am fine, and fiat does not have that. This is why we could say they are a bit different as well.

Would institutional investors ever be able to take over the Bitcoin market? I know that they may have a lot of money but I still doubt that they will be able to take over the whole market to the extent buying up everything. The market has so many investors, and I believe that the price will keep on increasing, so it wouldn’t be like in 2010 when someone has lots of money can buy up almost half of the market, nah things have changed this time and as time goes on it will keep on changing and the value will increasing as so many investors comes in. so whales are never getting a chance at all to do such a thing.

The fact that two things are essentially different in nature does not prevent them from being related. In this case there is an inverse correlation: the more money printed, the higher the price of Bitcoin (in fiat terms), and now that the FED has announced that it is going to reduce the drug dosage for the junkie, the price has suffered. Bitcoin and fiat (and central bank policy) are by no means completely independent, they are related. You yourself seem to recognize this at the end of the paragraph.

I disagree with you totally. That government is printing lots of fiat doesn’t mean that Bitcoin would lose value, how does bitcoin have anything to do with fiat? They are both different and independent on their own. Bitcoin was created to be a deflationary currency, while fiat is inflationary. So, these two are totally different. As more fiat is being printed, fiat would be the one that is losing value in this case due to inflation, while Bitcoin continues to gain more value as fiat continues to lose. That is just it.

What happens is that holders despite being part of the market by having large amounts of bitcoin are not participant on the process of rapidly buying and selling bitcoin which is where the process of price discovery happens, this means that with an even smaller amount of coins in exchanges traders can move the price of bitcoin even more easily as the supply is limited, meaning that as time passes the movements of bitcoin are now more correlated to what we see in the stock market instead of moving opposite to it, increasing the volatility of bitcoin slightly in the process.

I believe that when one person holds too much money, that is a risky thing, it should not be available to hold that much for just a single person (or company. In this case the institutional investors may or may not have too much of bitcoin, but they certainly do have it for some other.

Like just to give an example, we all know Binance holds a lot of BNB right? It's their own coin, and goes back to them and quite centralized, they haven't just sold all they had on the market because that would be shooting themselves on the foot, idiotic move, and they probably won't do it but the fact that they "could" changes things. Tesla had 1.5 billion dollars worth of bitcoin, they were able to share this as a news and it increased the price of bitcoin, they then said they sold it, and the price dropped as well. So, even if the amount is not big enough to change the market, the news of it certainly big enough.

The answer is absolutely yes. Firstly, it has become more stable (that is, for me, bad) but the worse thing is exactly what you hint in your post, the linking between the rest of the assets and the price of bitcoin. To be honest, there is no asset that can be free from the massive influence of the money printing by the central banks, is like using a gun against a tank and, lately, the FED and the CEB have been sending a full armoured division.

That's the reason why I always say that too much institutional money is not good for a decentralized market like crypto. Many companies are sitting on extra cash that they would like to invest in bitcoin. But that makes bitcoin too centralized and gives them a competitive edge over the market. Because they know, they can use their influence and holding to manipulate the market.

A prime example of such behavior is Elon's support to Dogecoin. We have seen how a coin has come back from deathbed with another life and people are going crazy over it.

Crypto is all about decentralization. But unfortunately it's unregulated nature is allowing it to be manipulated by the deep procket profit mongers.

I don't think so that's the reason for the current price dips as the whole market is in red and you can't say that's manipulation.In actual there were huge investments during the last year and people invested their surplus funds or say funds they need in crypto market and btc for profits but now they are withdrawing them but the conditions again hyped by panic sellers.The alt holders have also the same faith but institutions have nothing to do with it.There are equal investment by retail investors also in bitcoin if you look at the charts but yes big players have started to invest more from two to three years in bitcoin and they can invest big amounts easily compared to retail.Here is proof for the same :


Although the involvement of institutions have grown in Bitcoin market cap but still the major portion lies with the retail and they can't manipulate the market easily so for me there are other reasons for this and it will be over soon and prices will be going up.

The big institutions investors are only one or two who are playing big on bitcoin and we are familiar with them as always and these whom @OP is referring to have btc in their treasury reserves but can't think of some price manipulation by them.Here are some of the institutional investors i am aware about holds btc on their balance sheet :


Out of them only MicroStrategy is the one who is going on for investment at dips on regular basis and those who follow Saylor and btc news know this fact and they holds around 122k btc which is huge amount but if you check out in detail you would find out that they have bought them at average prices which are slightly more than the current rate.Other institutions have not invested for quite a time like Tesla or Sqaure and one time holding.

Saylor is true btc enthusiast and personally also holds more than 17k btc worth more than $600 million at this time also so see his company profits as well.The rest big institutional players he have in mind i don't know about it.


The current price dump like situations may be weird for many and they might be having numerous reasons for this as this time China can't also be balmed for anything as no new FUD from them.The btc manipulation is not at all easy as you need billion dollar investment and liquidation position to move the prices and institutions investing in it should do the reverse which is price boost but that's not happening at all.They will slowly move upwards as little sign of improvement will mark the new surge in them.

They've actually helped the market to grow and it's no doubt that they've played an important part during the start of the pandemic. About them owning more bitcoins, I don't fear that. There's nothing we can do as we're already in here and saw these institutions play and even a few years ago when it's just the community and a few large corporations that were interested in bitcoin, there's already the call and accusation of manipulation. So, it's not that really new if they do the same with those companies that we've said that have also been manipulating the market.

Bitcoin will always get new investors since we know many will grab its potential and this became so famous right now since it  change the dynamics a bit on financial system and almost all knows about it already. And although we need them but for sure time will came that bitcoin will go independently without anyone could possibly manipulate it since for sure in future it can stand on its own especially when many whales or big corporations are using bitcoin.

Before major institutional investors were into Bitcoin, it was speculated that once they come, the price will finally become more stable and less prone to huge decreases. But I think that it's safe to say now that these predictions didn't become our reality. We saw how easily money can be invested and pulled out of Bitcoin with Tesla, and we saw how Bitcoin lost 50% of its value during the current bear market. But as for manipulations, I don't think it's getting worse with institutional investors. It's just not getting better. And I generally agree with mk4 regarding the whole thing of Bitcoin price being manipulated by whales or whatever it is now.

We cannot say with certainty due to lack of proof, that the dump or trigger happy selling is due to them. The price did stabilize after touching this week's low.

Irrational price movements have been there since the market started trading. We attempt to pin down a specific movement or trend towards a specific reason but we always lack proof here, because it gives the trader a sense of being in control. In reality we are not the ones in control of the market but only in control of our own money and how we invest it.

The safety that bitcoin gives over fiat market remains unchanged, even if institutional investors flock in. The decentralization of money remains same and the only thing that can change is the possibility of sudden movements after a long period of stagnation. But all this is about the speculation of price.

Being a safe haven or not, I never considered any investment to be a safe haven. They all have their own risks. As long as I am in profit, I am happy.

I am not just talking about market manipulation by institutional investors now, but rather their erratic trading behavior. We are used to Bitcoin Whales with nerves of Steel and some of them are now being replaced by Institutional investors with trigger happy sell fingers.

So, what we will see now... will be a close correlation with what is happening on the global Stock markets and not a "commodity" that goes against the mainstream movement of the global markets.  

We have always said.... Bitcoin price volatility will decline, if we can distribute bitcoins to more people and if we can avoid an increase in whales... but Institutional investors are now becoming the new Bitcoin whales.

OP, after reading your post I'm just left scratching my head and wondering....who are "they"?  You've ascribed some very specific characteristics to "them" (like trigger happiness), but for the life of me I can't think of what big institutional investors are essentially gambling on bitcoin as you seemingly suggest.

It's true that some hedge funds and mutual fund managers will sell a stock or whatever asset we're talking about at the first sign of weakness, but my impression is that if any hedgies or other institutional investors with deep pockets are trading in bitcoin, they're not actually doing it with bitcoin itself but with derivatives--and as far as I know, the bitcoin price that's shown on preev and other sites isn't determined by what's happening on Bakkt or the CME.  I could be wrong.

I have to laugh at everyone who's using the word "manipulation" or variations thereof.  It's funny how that word vanishes from everyone's vocabulary when bitcoin is rocketing upward, and if anyone thinks there's manipulation going on in a bull market they're certainly not complaining about  it.

This is what is feared, but many hope that bitcoin always finds new investors. to me this is like a dilemma, on the one hand we need institutional investors to make the market grow rapidly. on the other hand they have the possibility to manipulate the market.

I think still, because even though this is manipulated by institutions but still their goal is profit and the important thing for small holder is not to follow the flow they create stay focused on the targets that have been made and not panic to see a red market, because it could be a target of large institutions to collect more from panic sell that is often experienced by small holders.

I don’t think it’s the institutions which are causing all these moves. Basically Bitcoin trades at something like 0.9 correlation with stock markets so many crypto traders are just watching the SP500 charts and following every move. And that’s why the correlation is there.

I haven’t seen it be this closely correlated for a long time however I just think many traders are taken advantage of that to make money. We saw what happened today with FOMC and crypto traders basically started the sell off when the stock market indices were crashing during Jpows speech.

Big money manipulating markets has always been 99% a tinfoil-hat theory. As more money enters the space, raising the marketcap, it will be harder and harder to influence the market.

Not to mention that when talking about trigger happiness, it's mostly retail rather than institutional. Any competent institutional investor don't invest in something just to panic sell after a drop or something.

The price movements of Bitcoin have always been like this ever since. Although the bigger picture has it appreciating, its short movements have always been highly unpredictable. No wonder why Bitcoin trading is oftentimes frustrating; it's because an accurate prediction has always been elusive. Charting doesn't guarantee anything either. So the entry of institutional money in Bitcoin won't really change much its price behavior. It has always been volatile, although with Bitcoin's market cap already reaching hundreds of billions, this volatility now translates to the price quickly jumping up and down by the thousands of USD.

The reality is we don't have this kind of reliable information. Most are just rumors and some may just want to spread fud in the market. As we don't know the authenticity of the source, it is better to take care of your assets and don't easily believe what you are reading. If you're here in this market, you basically know what to do with your assets. Otherwise, you will lose funds for nothing.

I think the holiday season and christmas are peaks for crypto volume. There is a lull in transaction volume for january through around march. Which is the time when bitcoin is most vulnerable to short selling. The first three months of the year is when short sellers who believe bitcoin is overvalued are most likely to make their plays.

Looking at charts of bitcoin price. I think january through march are the most likely months for a crash or a flatline trading. Mid to end year period is most likely for price gains.

Beginning of a new year is usually bearish or trending downward. People say the current january decline is an "anomaly" but looking at a chart of bitcoin prices, some of the biggest all time crashes occurred january through march.

I don't think otc data would help that much as anything that happens on the otc market will affect the normal exchanges too.

It's possible to buy data on otc markets though and may companies might factor it into their main currency data pulls (for example, coinbase pro, coinbase and coinbase prime might be aggregated together in one data pull).

what are the sources of information for purchase and sale of coin by institutions? I feel sometimes this source of information are influenced to deceive traders of accumulation,  we saw a lot of them in recent day of the dump and while finding the bottom of the market. Most of the purchases are on the counter not exchanges, so how do people know this accumulation? 

More irrational than what we have right now? I would think that it would be the opposite, that it would stabilize the fluctuation a bit. Primarily because investors are not the only factor that affects the price and the ups and downs. It's the sum of those factors that make up all of the turbulation that we have, but I guess that the natural evolution is in stabilization, either that or dying out.

This has been the case for a while now. When COVID-19 begun, all market crashed hard, and Bitcoin saw the most devastating flash crash in its recent history. Bitcoin also followed the mainstream markets in 2021 on multiple occasions, and just days ago it did the same when stock markets started declining. However, Bitcoin is not just following traditional markets 1:1 all the time. Usually Bitcoin recovers independently from them, and it still has a ton of independent price action.

I would say that Bitcoin is not a short-term hedge against traditional markets even if it itself is not considered a traditional asset, but in the longer run it's doing its own thing, which is increasing in value.

I do think that the investors are actually happy with small volatility since at the end of the day the volatility provides them with an option to invest more, I do think that the reason bitcoin's price is kind of regulated it might seem is majorly due to big exchanges and wallets as well. For example all the trading platforms generally close the withdrawal and selling the exact time the price goes profitable, I have experienced this a lot of times. There are many big companies which are also regulating Bitcoins indirectly. Investors are always coming and going but what stays same is the dominance of Bitcoins over any other Altcoins which is still pretty much there.

I don't think anythings changed that much price strength wise since larger investors came into the bitcoin space.

I think whenever institutions start buying and selling we might see more dramatic volume increases but institutions like to compete with each other so it's likely these will be done over the counter or both executed at the same time so it might just effect the volume.

Now, we know the Bitcoin price has not been phased much, when Wall Street and global markets have shown movement. These markets are used by large investors that are very trigger happy with the slightest volatility.

We also now know that these large investors are also dipping their toes in Crypto currencies (Bitcoin) and their trigger happy behavior are also coming with them.

Do you think as the injection of institutional money increase, that we will see more irrational price movement that are synchronized with global market movements?

Will Bitcoin still be a Safe haven when institutional money takes over the majority of the ownership of bitcoins and these people start to manipulate it in the same way that they are manipulating other markets?

Let's discuss.