Institutions heavily cut losses, BTC falls below the 200-week moving average

BTC continues to decline relentlessly, once again challenging the 61k barrier. This position is extremely delicate! Because the important support level of the 200-week moving average has already moved to the 61.8k level. And BTC has already fallen sharply in just a few days since the start of the month, reaching 61.5k, breaking below this key moving average.

Coincidentally, in 2022, it was also early June, the second week of June, when BTC first broke below the 200-week moving average of 22.2k during that cycle.

The subsequent history is unforgettable for everyone who experienced that harsh winter. By November of that year, BTC plunged to a low of 15.5k, hovering around 16k for two months until early 2023, when the extreme cold finally eased.

Four years later, today is another June, the temperature is starting to heat up, but the market seems to be heading into a severe winter. The aftermath of Strategy’s coin selling has not yet settled, ETF outflows have hit record highs. The market is filled with a sense of unease. Retail investors are panicking and selling at a loss, but have the institutions held their ground? [1]

No.

CoinShares recently released a data report based on the 13F quarterly filings. The 13F is a disclosure report required by the U.S. SEC for asset managers managing over $100 million. This report allows us to glimpse the true movements of institutional funds in BTC ETFs during Q1.

The data is substantial, the information is extensive. It’s best not to look, because after reading it, you’ll know the despairing answer:

Institutions have long since run away.

31.4k BTC withdrawals

In the first quarter of this year, professional investors’ holdings in BTC ETFs decreased from 313k BTC to 261k BTC. A reduction of 52k BTC, about 17%. The total value of holdings dropped from $27.3 billion to $17.8 billion, a 35% decline—caused by both price drops and reduced holdings. Meanwhile, the share of BTC ETF holdings reported by 13F filers fell from 24.7% to 20.8%.

CoinShares analyst Matt Kimmell’s comment is quite restrained: leverage and tactical strategies were released during the pullback.

In other words: during the decline, the so-called smart money that trades swings and arbitrages retreated first.

Who is retreating, how much they are retreating—that’s what makes this report truly interesting.

The retreat race

The selling is highly concentrated. Hedge funds and brokerages contributed about 96% of the reduction.

Hedge funds cut 31.4k BTC, a 39% decrease. Nearly 40%. Brokerages were even more ruthless, liquidating 18.8k BTC, a reduction of 53%. More than half of their holdings were wiped out. (Seeing this decisive liquidation, Coin Chain suddenly remembered the article from May 13th, “Half-Position Standing at the Critical Point”... Institutions are indeed cold, rational, and resolute.)

What did these institutions experience in Q1? BTC fell from a high of 126k to just over 60k, a 22% drop in a single quarter. ETF volatility was not less than spot. Market-making and arbitrage spaces shrank, but holding costs remained unchanged. Large-scale reduction was the most rational choice.

When the tide recedes, those who pretend to go into the water are the first to run. Hedge funds and brokerages are exactly those pretenders.

The contrarians

Retreating is one scene. But another scene is equally important: some are increasing their positions against the trend.

Advisors, the largest group of professional investors, hold 150.3k BTC, only reducing by 5.9%. Basically unchanged. Even more notable are the banks. Their BTC ETF holdings doubled in Q1, increasing by 7,800 BTC.

On one side are those who rushed to pretend to go into the water and then fled, and on the other side are the massive battleships slowly entering the water. This scene is very much like every cycle in the past. From the end of 2022’s 16k to early 2024’s 70k, from mid-2024’s 50k to 2025’s 120k—after each deep squat, there’s a more vigorous leap.

Banks are the most conservative financial institutions. Their entry or not is never determined by the market, but by regulatory frameworks. The most noteworthy event in Q1 might not be who is selling, but that: banks are finally starting to allocate (although the scale is still very small).

What makes banks start testing the waters? Coin Chain believes the answer is the increasingly clear regulatory trend.

CoinShares’ report also mentions that during Q1, several regulatory developments were quietly advancing. The regulatory boundaries between SEC and CFTC are gradually clarifying, and proposals to include digital assets in retirement accounts are progressing. Even more noteworthy is that afterward, the SEC released a draft strategic plan for 2030, explicitly prioritizing digital assets. The tone set by SEC’s new chair, Atkinson, is rational, coherent, and principled.

Once the regulatory framework stabilizes, banks’ allocations will no longer be impulsive but part of a long-term strategy. The doubling of bank BTC holdings in Q1 may just be the prelude.

Wall Street’s divergence

This set of data reveals a simple truth: Wall Street has never been a monolith. The divergence among institutions is much greater than retail investors imagine.

Hedge funds are quick in and out; brokerages are just riding the wave. Their reductions are elastic demand. Banks and advisors accept a certainty premium; their allocations are rigid demand.

The chart of changes in BTC ETF holdings in Q1 clearly points in one direction: trading capital is retreating, while strategic capital is entering.

This is exactly opposite to the market sentiment transmission. The market sees ETF outflows on a large scale, prices continue to decline, and panic spreads. But the details of the 13F filings show that if you compare holdings on December 31 and March 31, sellers have already escaped at high prices, while buyers are quietly positioning at low prices.

Coin Chain often says: one of the hardest things in investing is to stay calm when others are panicking. The 13F filings of institutions have written this calmness in black and white.

Don’t waste a crisis

This year’s Berkshire Hathaway annual letter to shareholders contains a phrase: decisive action, investing when others hesitate or fear, and standing firm amid financial storms.

At the end of 2022, when BTC was at 16k, the market also believed BTC would go to zero. During the eight months of sideways movement around 50k in 2024, the market also thought the positive effects of ETFs had been exhausted. Now, with over 60k, the market’s pessimism is even stronger than at 16k, because this is after falling from the peak of 126k.

But if we look back at the data shown in the 13F filings—banks entering, advisors holding steady, hedge funds clearing out—this may be a sign that the market is about to or is already undergoing a structural change.

BTC’s current price is a reflection of fear. The increased holdings by banks are a vote of confidence.

Don’t waste a crisis. Many people quote this phrase, but those who truly understand its meaning are those who silently persist in accumulating chips while others cut losses and hedge.