Whale capital rotation: dumping Bitcoin and spending hundreds of millions to buy Ether, could the alt season have quietly begun?

Whale Addresses in the Crypto Assets Market Are Making Large-Scale Strategic Adjustments, Continuously Selling Bitcoin While Simultaneously Buying Ethereum (ETH) Worth Hundreds of Millions. On-chain data shows that recently, 9 whale addresses purchased $456.8 million in ETH through custodial and OTC channels like BitGo and Galaxy Digital, while a new address concentrated on buying $164 million in ETH within 8 hours. This trend comes alongside ETH’s recent performance significantly outperforming BTC, as well as a structural shift with Bitcoin ETF capital outflow and enhanced fundraising capability of Ethereum ETFs, indicating that the altcoin season may be approaching.

[Whale movements are clear, institutional channels become the main force for accumulation]

Blockchain analysis company Arkham reports that 9 Whale Addresses recently purchased a total of $456.8 million in ETH, with 5 of the addresses receiving transfers through the custodian BitGo, while the rest were completed through Galaxy Digital’s OTC desk. Almost simultaneously, Lookonchain monitored 8 newly created wallets that bought 35,948 ETH (approximately $164 million) from FalconX and Galaxy Digital within 8 hours, indicating that institutional-grade platforms are becoming the main channel for large funds to allocate ETH.

[Market differentiation is significant, ETH continues to outperform BTC]

Behind the capital flow are significant performance differences between two major Crypto Assets: over the past month, ETH has risen by 18.5%, while BTC has fallen by 6.4%. Although both have retreated from their historical highs, BTC is down 10.3% from its peak, while ETH has only pulled back by 6.7%, indicating stronger relative momentum. Analysts point out that some early BTC holders have begun to take profits, such as a Whale who recently transferred 750 BTC (worth $83.3 million) to Binance, with speculation in the market that they may be reallocating some funds to ETH.

[The evidence of capital rotation is clear, whales are using BTC profits to swap for ETH.]

On-chain records further confirm that funds are being transferred across assets: a Whale sold $76 million worth of BTC this month and bought $295 million worth of ETH instead; another Address that had been dormant since 2021 also withdrew 6,334 ETH ($28 million) from Kraken. More notably, an anonymous participant purchased $2.55 billion worth of ETH via Hyperliquid and staked it all, locking in a long-term position. These operations indicate that large funds are taking advantage of the opportunity to accumulate at lower prices due to BTC profits and the recent ETH price correction (from $4,900 down to around $4,300).

Structural differences are the deep-seated reasons for capital shifts.

Market analysts point out that there are fundamental differences in the supply structure and holder behavior between Bitcoin and Ethereum, which have boosted this round of capital rotation. Analysts like Willy Woo believe that the early holders of BTC have a very low cost (some below 10 dollars), and even at the current price, the willingness to take profits remains strong, creating continuous selling pressure; whereas ETH provides additional incentives for long-term holding through its staking mechanism, resulting in a more dynamic supply and less selling pressure. Analysts like Ted Pillow further point out that the current distribution pressure of BTC limits its upward momentum, leading to a continuous flow of funds to ETH.

[Altcoin season signal strengthens, ETF flows and market structure show changes]

(Source: Altcoin Vector)

The trend of capital rotation is particularly evident at the ETF level: last week, US Bitcoin ETFs experienced six consecutive days of capital outflow, totaling over $1 billion; while the Ethereum ETF alone attracted $455 million on Tuesday, with BlackRock’s ETHA and Fidelity’s FETH being the main contributors. According to CryptoQuant data, the open interest in CME Ethereum futures has increased, indicating that new funds are entering the market. Swiss block analysis points out that Bitcoin’s dominance (currently 57.3%, down 3% month-on-month) continues to weaken, with the altcoin vector indicator reaching its strongest level in four years, and the liquidity cycle showing that funds are overflowing into Ethereum and other alts.

[Conclusion: Capital rotation has emerged, investors need to be vigilant about changes in market structure]

Whale collective behavior, large transfers through institutional channels, ETF fund flows, and changes in market dominance are all sending strong signals: funds are flowing from Bitcoin to Ethereum and other alts. Although retail investors have not yet entered on a large scale—this is usually seen as a positive signal that the market has not yet peaked—early positioning by institutions and whales may have already initiated a true altseason. Investors are advised to closely monitor the BTC/ETH exchange rate, staking data, ETF flows, and large on-chain movements, and to adjust their positions in a timely manner to respond to changes in market cycles.