Bitcoin’s seasoned players are shaking things up. On-chain data reveals that the world’s leading cryptocurrency has experienced three significant waves of transfer into spot exchange-traded funds (ETFs) since their inception in the US in January 2024. These movements signify a notable shift in market dynamics as veteran holders, often referred to as “diamond hands,” opt to make their holdings more liquid through these investment vehicles.
Veteran Holders Make Their Move
A closer look at the data, shared by CryptoQuant’s Maartunn, highlights how these ETFs have become a magnet for long-held Bitcoin. The ETFs, which trade on traditional financial platforms, offer a user-friendly way for investors to gain exposure to Bitcoin without the complexities of owning it directly. In doing so, they appear to have enticed some of the oldest hands in the Bitcoin community to part with their coins. This trend aligns with broader movements in the market, as detailed in Bitcoin ETPs now hold 7% of Bitcoin’s maximum supply.
The Bitcoin Coin Days Destroyed (CDD) metric—a measure of the dormancy time of Bitcoin before it’s moved—spiked alongside these ETF inflow waves, indicating that coins previously held for long periods were being shuffled. Such spikes were observed during the major inflow phases in Summer 2024, Fall 2024, and most recently, Summer 2025. This pattern suggests a strategic reallocation of assets, as veteran holders capitalize on the robust demand driven by these ETFs.
The ETF Attraction
The allure of spot ETFs lies in their simplicity and accessibility. They represent a straightforward way for traditional investors to dip their toes into cryptocurrency waters. When an investor buys an ETF, the fund purchases an equivalent amount of Bitcoin on their behalf, causing on-chain movements that are visible to analysts. This functionality not only broadens the investor base but also provides a lucrative exit strategy for long-term holders looking to cash in on their investment without the hassle of navigating cryptocurrency exchanges. This shift in investor behavior is further explored in Spot Bitcoin ETFs surge, Ether funds bleed as investors flee for safety.
“ETF inflows are key,” Maartunn pointed out. “Without strong new demand, selling pressure from new holders could increase.” This highlights the delicate balance ETFs bring to the market—acting as both a stabilizing force and a potential source of volatility, depending on the demand dynamics.
Market Implications and Future Trends
The rise of Bitcoin ETFs has not been without its challenges. While the initial excitement led to substantial inflows, Maartunn observes that recent demand has cooled, with the ETF netflow returning to neutral levels. This pause raises questions about the sustainability of ETF-driven growth in the Bitcoin market. Without continued interest from traditional investors, the market could encounter increased selling pressure from recent ETF entrants looking to offload.
Bitcoin’s price, currently hovering around $110,500, reflects a 2% uptick over the past week, illustrating the market’s resilience amid these shifts. However, the future remains uncertain. Will traditional investors continue to flock to Bitcoin ETFs, or could the market see a retreat if demand falters?
As we look ahead, the interplay between veteran holders and new entrants via ETFs will be pivotal. The potential for ETFs to stabilize or destabilize the market underscores the importance of monitoring these inflow trends closely. For now, the market waits with bated breath to see if another wave of interest will wash over the crypto landscape or if the waters will remain calm.
Source
This article is based on: Old Bitcoin Supply Keeps Moving Into ETFs: Data Shows Three Waves So far
Further Reading
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
