Bitcoin closed June above $104,000, marking its highest monthly close and strongest second quarter on record. This rise contrasts with traditional on-chain data, which suggested weaker buyer demand during the same period.
U.S. spot Bitcoin exchange-traded funds (ETFs) registered nearly $4 billion in inflows in June, including a notable $550 million on June 25, reflecting robust institutional interest, according to SoSoValue data.
Experts highlight a disconnect between on-chain signals and institutional buying patterns. Most large investors conduct transactions off-chain or through over-the-counter (OTC) desks, which do not register on public blockchain metrics.
Aslan Tashtanov, a blockchain engineer at Mysten Labs, explained that institutions typically buy Bitcoin via centralized exchanges or OTC desks to handle significant volumes without disturbing market prices. This approach allows institutional capital to influence prices without triggering conventional on-chain indicators.
Meanwhile, retail spot trading activity remains neutral despite recent price gains. Data from CryptoQuant shows that Bitcoin balances held in known OTC addresses have declined to historic lows, with miner-linked balances down 18% since January to about 156,000 BTC. Miners, who hold large Bitcoin reserves, are considered institutional-level market participants.
Kony Kwong, CEO of GAIB, emphasized that large institutional purchases often go unnoticed in on-chain data, making demand appear weaker even when capital flows through ETFs and exchange-traded products (ETPs). Kwong noted that in the post-halving environment—with reduced new supply—even modest institutional demand can significantly impact the market.
The April 2024 Bitcoin halving, which halved miner rewards, did not immediately boost prices. Instead, Bitcoin experienced its weakest post-halving performance, dipping to around $75,000 amid market uncertainty driven by external factors. This contrasts with previous halvings that triggered rapid rallies, according to Kaiko Research.
Supply constraints and varying market reactions affect institutional strategies, which also depend on infrastructure. Tashtanov pointed to alternative blockchains like Sui that facilitate institutional access to Bitcoin through decentralized finance (DeFi) platforms. Bitcoin accounts for over 10% of Sui’s total value locked.
One key limitation for institutions is insufficient on-chain liquidity to fulfill large orders. At the time of writing, Bitcoin trades near $106,200 with a daily volume of approximately $25.7 billion, per CoinGecko.