During bull markets everyone is hyped when mainstream and big institutional investors start accumulating Bitcoin.

Who, in their right mind, would be opposed to that?
It is fresh capital being injected into the Cryptocurrency market.
It is capital which increases the total Market Cap.
It underlines the “validity” of Bitcoin and Crypto at overall.

But there is another side.

During bear markets can the same institutional investors realize losses.
They can decide to DUMP their holdings in order to cut losses.
Or the losses can be so severe, when positions are over-leveraged, that the entire company has to declare bankrupcy.

Examples?
In 2022 did I cover a few examples.
– What happened with Terra ( $LUNA )?
– High APY, long term failure.

These two entries illustrate what can happen when financial institutes are “whales”.
So the same companies who you cheer upon during bull runs to increase their holdings, and in turn give you a bit more profit on your holdings, also hold the power to utterly destroy it.

I will be the first to say that bear markets tend to be GREAT times of opportunity.
Even though do such bankruptcies hurt deep when they simply DUMP their Bitcoin back onto the market.
Which means I am also a fan, in terms of Bitcoin, to say “buy when the streets are red”.

But this all brings up an important argument considering Bitcoin.
A fundamental which pertains to Satoshi’s original vision and is frequently forgotten when a whale like MicroStrategy starts moving.

“Bitcoin needs to be decentralized and fully distributed”.
Decentralization and fair distribution being key elements that pertained to the success of Bitcoin.
Dan Held made an entry about the historical distribution of Bitcoin and the maturity Satoshi had in order to widely distribute as much as possible.

While incepted as peer-to-peer electronic cash system did Bitcoin ultimately evolve into a digital asset and “value-holder”.

The more mainstream it becomes the more money gets involved… but also the risk of it being much less distributed as BIG players in TradFi can now covert their millions of dollars in fiat and change it into Bitcoin… giving them the opportunity to leverage the market.

MicroStrategy, and its (former) CEO Michael Saylor, are such a whale.
Praised by the majority of the Crypto community and Bitcoin Maximalists for bringing BTC into the mainstream. But meanwhile is its holding position 132,500 Bitcoin.

These are 132.500 Bitcoin in ACTIVE circulation.
132.500 Bitcoin stacked by a SINGLE entity which is subject to laws and regulations from TradFi markets.
A single entity that CAN mismanage such as Celsius Network, 3AC and Terra Foundation did.

The good news is that each time such a whale crashes that there will be opportunity for retail to buy-in on the cheap.
The bad news will be that many people will either:

• Lose trust or are fearful and will dump as well (or not buy-in)
• Those who buy will park their freshly acquired BTC in Exchanges.
  

The bad news is that Centralized Exchanges tend to be whales as well.
Simply buying and keeping your Bitcoin over there means that the death of one whale will feed the others.

It is therefor of utmost importance to get your fundamentals straight!
Self-custody is key. Buy that hardware wallet.
Do cold storage. Safeguard your keys.

Above all… do not praise nor feed the whales.
Look after yourself (which is what they’ve done) and make sure you truly OWN your own Bitcoin and Crypto.

Take care,

Your Friend
Dimitri.