Publicly traded companies holding Bitcoin and Ethereum have largely stopped increasing their holdings since the market plummeted in early October, indicating a recent lack of confidence.
According to David Duong, the global investment research director at Coinbase Institutional, digital asset management firms purchasing Bitcoin "have basically ceased operations after October 10 and have not re-entered the market."
He added, "Over the past two weeks, the buying intensity for Bitcoin has dropped to near its lowest point this year, and there has been no significant rebound even when the market rose."
The slowdown in cryptocurrency purchases reflects a cautious trend in the sector. Many related companies' market capitalizations have gradually approached the value of their held assets, while stock prices have retreated from previous significant gains.
Bitcoin fell 9% between October 10 and 11, dropping from about $12,150 to below $11,050. It briefly dipped below $10,500 this month but then rebounded to $11,425, maintaining a stable trend over the past 24 hours.
According to Duong, the wait-and-see approach of Bitcoin-buying companies is significant. These companies are typically strong players, but their retreat since October 10 shows limited confidence.
He added that this slowdown in buying intensity "highlights the caution of large participants after leveraged liquidations, even when currently at 'support' levels."
Duong pointed out that BitMine Immersion Technologies, an asset management firm focused on Ethereum, has been the "only consistent buyer" since the market downturn, with data showing that the company has invested over $1.9 billion and purchased nearly 483,000 Ethereum since October 10.
Earlier this month, Ethereum fell in sync with Bitcoin, dropping over 15% between October 10 and 11, hitting a low of $3,686, but has since slightly rebounded to $4,130.
Duong stated that BitMine's continued buying, along with "small-scale increases from other funds," has turned the total net buying of Ethereum asset management companies positive over the past week.
However, he added that if the company "slows down or pauses operations, we are concerned that the significant buying momentum from the corporate side may fade."
Duong said, "We believe a more cautious position strategy should be adopted in the short term. When the largest and most autonomous capital providers choose to wait and see, the market behaves more vulnerably."
Related: MegaETH token sale oversubscribed by 8.9 times, securing $450 million in commitments
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