As Bitcoin Crashes, Data Shows Whales Are Buying the Dip

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As crypto winter bites deeper, on-chain metrics suggest trust between Bitcoin whales is far from diminishing.

The major cryptocurrency is currently trading below $20,000, down 35% year-to-date and up 71% from its all-time high of around $69,000 in November. last year.

During sell-offs like this, many investors liquidate their positions. However, this does not seem to be the case when it comes to those who hold more than 1,000 BTC.

New data from IntoTheBlock indicates that this demographic has actually continued to hoard cheap coins despite bearish prices.

Source: IntoTheBlock.

“During the last multi-year bear market, Bitcoin whales took advantage to accumulate at a high rate, as indicated by the red arrow in the chart,” said Juan Pellicer, research analyst at the firm. IntoTheBlock blockchain analysis. Decrypt.

Pellicer, however, pointed to the fact that while the balance of the whales continues to grow, “so far we don’t see them doing so with the same intensity as the bear’s last cycle.”

Earlier this week, analysis of the Glassnode blockchain also said whales are aggressively adding to their balance, acquiring 140,000 Bitcoins per month directly from exchanges.

Currently, whales own up to 8.69 million BTC, or 45.6% of the total Bitcoin supply of 21 million, according to Glassnode.

Bitcoin bull market in sight?

Whales buying low-priced Bitcoin could theoretically signal a return to a new bull cycle.

Yet when asked about the likelihood of such a scenario, Pellicer said there were no “clear on-chain structures that indicate a very rapid market recovery.”

There are some bright spots, however, he added, pointing to the continued confidence of retail investors in Bitcoin – holders of balances between 0.1 and 1 BTC – who are “taking advantage of the market decline to accumulate at a faster pace than usual”.

“This rapid pace of accumulation by retail [investors] was only seen in the past two years right after the Covid crash, and the price at the time rebounded strongly after a few weeks,” Pellicer said. Decrypt.

Disclaimer

The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment or other advice.

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