More than 470,000 BTC left dormancy in 2025, largely due to shifts in custody, rather than capitulation, analysts say.
According to on-chain analyst Willy Woo, Bitcoin’s supply of Taproot addresses has fallen by about 3% since January 2024.
The drop is sparking debate in the crypto community, with experts divided over whether long-term holders (LTHs) are quietly selling their funds or simply repositioning amid growing concerns about quantum computing threats.
Bitcoin House Cleaning or Whale Sale?
Data shared by Woo on The analyst explained that this shift may not indicate panic selling, but rather “house cleaning” by early holders, who are moving BTC to safer or custodial environments.
“What an ‘OG dump’ entails is simply BTC leaving an address that has remained untouched for seven years,” Woo wrote. add that on-chain data can misinterpret such activities as sales, when they often reflect a reorganization or posting of collateral.
Fellow analysts, including Charles Edwards of Capriole Investments, countered that large-scale moves by early Bitcoin holders tend to correlate with selling pressure. “We know this empirically,” he said, pointing to colorful charts showing hundreds of millions of old BTC in 2025.
Others, however, supported Woo’s views. On-chain researcher Shanaka Anslem Perera noted that about 470,000 BTC, worth about $50 billion, left dormancy this year, but much of that movement involved custody rotations and government bond placements rather than market sales. “The story is not a capitulation,” he wrote, “rather it is the evolution of guardianship, the acquisition of collateral and an institutional catcher’s mitt.”
Quantum fears lead to shifts in custody
The timing of these taproot withdrawals coincided with growing unease about Bitcoin’s long-term resilience to quantum computer attacks. In July 2025, developers proposed ‘P2QRH’, a quantum-resistant address type aimed at protecting up to 4 million vulnerable BTC, approximately 25% of the supply, from future major exposure risks.
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The urgency grew after Project Eleven launched its Q-Day Prize challenge in April, offering 1 BTC to anyone who could crack Bitcoin’s cryptography using Shor’s algorithm before April 2026. The experiment, designed to test whether real quantum hardware can threaten Bitcoin’s elliptic curve encryption, reignited debate over how soon the network could face real cryptographic stress.
Hardware manufacturers are also responding, with Trezor announcing the Safe 7 wallet in October, the first ‘quantum-ready’ self-management device.
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