Now that most real trading occurs completely off of the exchanges, and there is no way to follow it
Is that a fact (say, deduced from analysis of the blockchain)?
When one wants to buy or sell something vauable, it is usually better to do it through a market or broker. Otherwise one may waste a lot of time looking for the partner, and the price may end up being well above or below the market's price - leaving one of the sides quite frustrated.
So, who would want to trade bitcoins in private, and why?
I'm not going to guarantee to you that this is a fact. It's only what I've heard and what the most rational explanation for things are. I'll leave it to someone else to do the confirming. Anyway the reason someone would do this is:
1. Investors do not trust millions of dollars to unregulated offshore businesses. They would rather meet face to face at a business with a whale in the United States (or elsewhere) and transact in secure environment in a situation that they can control and verify. In the case of the investment trusts, the investors can actually invest in a wall-street type fashion with the protections of strong US regulation and banking.
2. The investors want to acquire massive amounts of coins without slippage and without moving the market. Currently the exchanges don't have the liquidity to acquire 10,000 coins without incurring massive slippage and starting a rally. Instead the fiat whales will meet directly with btc whales who are in an equal situation where they want to sell 10,000 coins without moving the market. The transaction happens in secret without moving the market, everyone is happy, and the investors can go on making additional transactions at the same price.
