As crypto markets — from Bitcoin to major altcoins — undergo a sharp correction, exchange data suggests the selloff is being driven less by retail panic and more by large holders, commonly known as whales.
In crypto, whales are individuals or entities that hold substantial quantities of digital assets, often large enough to influence prices through concentrated buying or selling.
Bitcoin has fallen from its record high of $126,000 in October 2025 to around $65,000. While steep, the decline is relatively contained compared with the bloodbath in altcoins. Ethereum has dropped 36%, Binance Coin 32%, Cardano 26%, Solana 37% and XRP 29%, reflecting higher volatility beyond Bitcoin.
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The losses also follow US authorities’ announcement that trade agreements already reached with allies remain in effect despite a Supreme Court ruling invalidating President Donald Trump’s use of emergency powers to impose tariffs. Trump later said he would raise the proposed 10% global tariff to 15%, adding to market volatility.
Whale activity surges as liquidity tightens
Large-holder activity has intensified at a time when capital inflows into crypto are weakening, amplifying downside volatility.
Data from CryptoQuant shows whale deposits on major exchanges have surged, particularly on Binance. Over the past month alone, $8.3 billion has flowed into exchanges, marking a two-year high. Analysts say these inflows could signal preparations for selling or strategic portfolio reallocation. Some view the trend as liquidity management rather than an imminent mass exit.
Institutional movements appear to be rising in parallel. Nearly $206 million has reportedly been transferred to Coinbase Institutional for security and compliance purposes, indicating that large players are repositioning capital even as broader sentiment weakens.
The total crypto market capitalisation currently stands at roughly $2.3 trillion, spanning 1,468 exchanges and 18,838 listed coins globally. Following the downturn, several exchanges have reported weaker financial performance. For instance, Coinbase Global Inc. reported a 20% drop in revenue to $1.8 billion and a $667 million net loss as Bitcoin declined 50%. Gemini and Robinhood have also faced pressure.
Read More: Coinbase reports $667 million net loss, revenue slumps 20% amid crypto meltdown
Post-ETF momentum fades
The correction follows the so-called post-ETF hype cycle. When spot crypto ETFs were approved, institutions gained regulated access to Bitcoin via stock exchanges. Massive inflows followed, driving prices to $126,000 in October 2025. However, ETF inflows have since slowed, with outflows rising, suggesting early institutional enthusiasm may be moderating.
At the same time, stablecoin inflows — often viewed as dry powder for crypto purchases — have shrunk. This has reduced liquidity available to absorb selling pressure, intensifying volatility in altcoins.
Analysts note that fears around renewed US tariff measures, leverage unwinds and broader macro uncertainty contributed to Bitcoin’s drop below $65,000 on February 22.
Amid the volatility, US Treasury Secretary Scott Bessent said on February 13 that Congress should pass federal digital asset legislation and send it to Trump this spring. He argued that the proposed Clarity Act would provide “greater comfort to the market” during heightened volatility, adding that its prospects could diminish if political control shifts after the November elections.
While some interpret rising whale deposits as a precursor to further selling, others argue such cycles have historically marked accumulation phases, with large holders eventually buying into weakness once volatility subsides.