Executive Summary
The Story So Far
Why This Matters
Who Thinks What?
Cryptocurrency whales, or large-scale investors, have significantly increased their Ether (ETH) holdings, acquiring hundreds of millions of dollars worth of the asset as analysts suggest a “natural rotation” from Bitcoin (BTC) profits into altcoins with higher upside potential. This shift, which includes nine “massive” whale addresses purchasing a cumulative $456 million in Ether from institutional platforms, is fueling expectations for a broader altcoin season in 2025.
Whales Accumulate Ether
Blockchain data platform Arkham reported on Tuesday that nine prominent whale addresses collectively bought $456 million worth of Ether from Bitgo and Galaxy Digital. This substantial accumulation underscores a growing investor interest in the world’s second-largest cryptocurrency by market capitalization.
According to Nicolai Sondergaard, a research analyst at crypto intelligence platform Nansen, this surge in whale demand signals a “natural rotation” into Ether and other altcoins. Sondergaard noted that investors are likely locking in profits from Bitcoin’s recent rally and reallocating funds to other tokens in pursuit of further upside.
Ether, in particular, is benefiting from this trend due to its strong current mindshare and momentum, especially from companies with Ether treasuries. While the recent Ether whale movements are notable, Sondergaard suggests that the broader market trend involves capital spreading out beyond Bitcoin as participants seek the next major move.
Capital Rotation from Bitcoin
The increasing profit-taking from Bitcoin may serve as a precursor to a heightened focus on Ether from investors. Crypto analyst Willy Woo also highlighted the growing capital rotation, observing that daily inflows into ETH are now approaching those of BTC.
Woo further noted that this latest streak of inflows began when BitMine, an Ether treasury company associated with Tom Lee, initiated its ETH accumulation. This suggests a strategic shift by institutional-level players.
Adding to this narrative, a Bitcoin whale holding over $11 billion recently sold $2.59 billion worth of Bitcoin. This substantial sum was then rotated into a $2.2 billion spot Ether position and a $577 million Ether perpetual long position on the decentralized exchange Hyperliquid.
“Smart Money” Shifts to Altcoins
The industry’s most successful cryptocurrency traders, identified as “smart money” by Nansen’s blockchain intelligence platform, are also reportedly rotating into altcoins. This activity is intensifying investor expectations for an altcoin season in 2025.
Analysis of their most significant large-cap token acquisitions reveals that smart money traders have acquired $1.2 million worth of Chainlink (LINK) tokens, $967,000 worth of Ethena, and $614,000 worth of Lido DAO tokens. The increased LINK acquisitions may be linked to Bitwise Asset Management’s recent filing to launch a LINK-based exchange-traded fund with the US Securities and Exchange Commission.
These cumulative altcoin acquisitions are complemented by other significant Ether purchases, including a dormant whale, inactive since 2021, who recently acquired $28 million worth of ETH.
The ongoing capital rotation from Bitcoin into Ether and other altcoins, driven by profit-taking and the search for new growth opportunities, indicates a maturing market dynamic. This trend, supported by whale movements and “smart money” allocations, suggests a potential shift towards a broader altcoin season in the coming year.
