Where Do Crypto Bears Come From?

Can you imagine someone who owns cryptocurrency but is not interested in its price going up? At first glance, it sounds unlikely. Almost everyone who holds crypto wants it to rise. Which would mean that almost everyone in the market should be a bull.

But the reality of late 2025 breaks this illusion. For several months now, bears have clearly dominated the market:

• Bitcoin is down 30%
• Ether has lost 35%
• Total market capitalization has fallen by $1.2 trillion

Behind these numbers are real people and real companies that own crypto assets and are actively pushing prices lower. But if most holders are supposedly interested in higher prices, where do all these sellers come from? Who are they, and why are they selling?

Let’s take a closer look.

The Obvious Answers: Whales, Miners, and Leverage Traders

There are a few obvious answers that usually come to mind first.

First, whales — large holders.
If you owned a significant amount of Bitcoin, what would you do with it? One option is to simply hold and do nothing. Many whales do exactly that. But there is another, less obvious strategy: selling call options and earning option premiums. And this is also something whales actively do.

A call option is a contract that obligates the seller to sell the underlying asset — for example, Bitcoin — if its price rises. The contract itself costs money, and the seller receives that money upfront. From the whale’s perspective, this creates a situation where they remain profitable in almost any scenario.

If the price does not rise within the specified period, the option expires worthless. The whale keeps both the Bitcoin and the premium. If the price does rise, the premium still stays with the seller, but they now have to sell Bitcoin at the agreed price. This is why, during every upward move, some large holders end up selling Bitcoin — and this selling pressure naturally caps the price.

That said, whales are not really bears. If the price falls again, they will simply buy their Bitcoin back and continue earning option premiums.

And in general, this strategy mainly applies to Bitcoin and similar assets that cannot easily be used to generate yield. Most modern cryptocurrencies are based on variations of Proof-of-Stake, which allows large holders to earn returns by participating in transaction validation. In those cases, selling options is not strictly necessary.

Second, miners.
At first glance, this may seem paradoxical. The very participants who literally keep a cryptocurrency alive are often among its sellers. But the economics here are brutal. Miners have to pay for electricity. If they just hold and wait, they will have nothing to pay their bills with. This is not a matter of choice — it is a matter of necessity.

Large companies like Marathon Digital or Riot Platforms can sometimes afford to accumulate the coins they mine. Smaller operators cannot. They sell steadily and persistently, applying constant pressure to the market. Quietly, almost invisibly, but relentlessly — like water wearing down stone.

Of course, this applies only to Proof-of-Work cryptocurrencies as well.

The third obvious group — leverage traders — is a curse of all markets, regardless of how a particular cryptocurrency is issued.

In December 2025, a well-known supporter of the HYPE token, operating under the pseudonym NMTD, borrowed BTC, ETH, and SOL against nearly 1 million HYPE. Using the borrowed assets, he opened perpetual swap positions on HYPE at prices between $36 and $42, with leverage.

In simple terms, this was a bet that HYPE would outperform the three borrowed cryptocurrencies. The bet failed. When the price came within 5% of liquidation, the trader was forced to sell one third of his HYPE holdings — 312,000 tokens — at $27.15. The proceeds were used to repay debt and save the remainder of the position.

This is how a convinced bull becomes a forced bear. He sells a large amount, and sells it near the bottom. Sooner or later, this happens to everyone who opens positions larger than their actual capital.

Given the unprecedented growth of onchain perp trading platforms, it would be surprising if this mechanism were not producing a growing number of bears in the market.

A Less Obvious Answer: Pragmatists

In the summer of 2022, when the crypto market was gripped by panic, a symbolic moment took place at the MicroStrategy World 2022 conference. Michael Saylor, the CEO of MicroStrategy, invited Jack Dorsey, the CEO of Block, along with other prominent Bitcoin supporters. During a video conference, they discussed the very question I am asking today: Who is selling and pushing prices down?

Michael Saylor said, “I am not selling.”
Jack Dorsey replied, “I am not selling.”
Someone added, “Elon Musk is not selling.”

It sounded convincing.

But reality turned out to be far more complicated — at least in Elon Musk’s case.

In February 2021, Tesla purchased $1.5 billion worth of Bitcoin, sending a powerful signal to the market. Yet in 2022, almost at the very bottom of the bear market, Tesla revealed a surprising fact in its financial reports: the company had sold 75% of its Bitcoin holdings for $936 million — at a price lower than its original purchase.

Musk explained the move not as a loss of faith in Bitcoin, but as a need for liquidity caused by production disruptions in China during COVID. But markets do not react to explanations. They react to actions.

As of 2025, Tesla still holds its remaining Bitcoin, now valued at $1.24 billion. In other words, Tesla still came out ahead. The company invested $1.5 billion, later sold $936 million worth, and still holds Bitcoin worth $1.24 billion.

Musk remained a bull. But at the moment it mattered most for his business, he acted like a bear.

The same logic applies to unlocks of token allocations held by venture capital firms. Early investors are the most cynical category of sellers, and in 2025 they play a massive role in the market. A venture fund enters a project at a very early stage, buying tokens for pennies — sometimes at prices 100 times lower than the market price at launch. But the smart contract sets a strict rule: these tokens cannot be moved until a predetermined date.

When that date finally arrives, investors flood the order books with their tokens, without paying much attention to price. In this sense, their behavior closely resembles that of regular users who receive tokens through airdrops.

Have you ever received tokens from an airdrop? What did you do with them — keep them as a souvenir or sell them? At Rabbit.io, we professionally handle cryptocurrency exchanges, and I can say with confidence that on airdrop days, a large share of the “lucky recipients” quickly swap their new tokens for something they consider more valuable — usually stablecoins. And this behavior does not depend on the specific token. It applies to any asset that is obtained for free.

And since venture funds receive their tokens not for free, but still at a very low cost, their motives are essentially the same. Tokens themselves were never the goal. What every venture fund truly needs is profit — something it can show to its investors in a quarterly report in order to attract new capital.

And the Most Uncomfortable Question: Does Anyone Actually Need Crypto?

This brings us to a question that became especially relevant in late 2025. A question about why people bought cryptocurrency in the first place — those whose wallets are now full of it.

Venture funds are easy to understand. They never needed the tokens themselves. They planned to sell them from day one. But what about everyone else?

Originally, cryptocurrency carried a much deeper meaning. It was supposed to be a revolution — a way to overturn the financial system. Bitcoin was meant to replace the dollar, the euro, the yen, and every other fiat currency. People once bought Bitcoin to be part of that change.

Today, Bitcoin and other cryptocurrencies are being absorbed into the very system they were meant to disrupt. And in this new role, who actually needs them?

Have you noticed how many stories about long-time holders selling their Bitcoin appeared in 2025? I do not remember seeing anything like this in previous years.

The sellers — the bears — are those who have lost faith in cryptocurrency. And also those who never had that faith to begin with.

This stage of the market is also defined by the fact that large volumes of cryptocurrency are now concentrated in ETFs. The fund shareholders who paid for all this crypto never actually received it, nor did they experience its most important features: self-custody, censorship-resistant transfers, or frictionless exchanges across the crypto ecosystem.

They never truly needed the cryptocurrency itself. Just like venture capitalists, they were only interested in price appreciation. Which means they are just as ready to take on the role of bears.

And this is true for any other kind of speculator as well. They do not actually need cryptocurrency either, and they are just as ready to sell it at any moment.

At this point, the list of bears is starting to look suspiciously long. And what if we also add:

• governments (they also hold crypto, and in practice they do not really need it),
• bankrupt companies (think FTX),
• treasury-style companies that bought crypto using investors’ money,
• and ordinary people who simply want to spend rather than save?

Then it becomes obvious that the market is not made of bulls alone — and that price downturns are not random accidents, but a natural, predictable part of how this market evolves.

Conclusion

So, if there are so many bears in the market, does that mean it is time to give up on cryptocurrency altogether? Not at all.

A year ago, I wrote about how to build a crypto portfolio for 2025. The very first idea in that article was simple: choose assets that have clear value either for you personally or for someone you will be able to sell them to. If you follow this principle — and especially if you narrow it down to buying cryptocurrencies that you genuinely need yourself — then neither bears nor bear markets should really scare you.

• Need reliable long-term storage secured by unprecedented computational power? Buy Bitcoin.
• Need an asset with a predictable price to protect yourself from the decline of an unstable national currency? Look at dollar-pegged stablecoins. Some of them combine price stability with the core advantages of cryptocurrencies — for example, Liquity USD and DAI.
• Conduct a large number of stablecoin transactions? Acquire the cryptocurrency used to pay gas fees on the network where your activity takes place: ETH, TRX, SOL, and so on.
• Support artists and buy digital art? The most popular platforms typically settle payments in XTZ.
• Trade on CEXs and want lower fees? Take a closer look at CEX tokens such as BNB, MNT, BGB, and others.
• Want to support a politician or bribe an official? Buy their token. 2025 has shown that this, too, is no longer unusual. (I will refrain from giving examples.)

As you can see, there are still plenty of genuinely useful assets in the crypto space. Yes, they have their own bears as well. But if those bears push prices lower, you will simply buy more — and be glad you had the chance to acquire something you would have bought anyway, just at a better price.