I see what you're getting at, perhaps it's easier to explain this way:

When there is fiat, a whale can sell a large amount of BTC for fiat, causing volatility. When there is no fiat, only BTC, it's impossible to dispose of a large amount of BTC, because there is no other liquid asset to sell it for. You can't spend thousands of BTC for megatons of cheese or milk, because there is not enough cheese, not enough milk and transporting / storing large amounts of these goods is problematic. In other words, there is no way to 'dump' BTC.