Key Points
- Bitcoin whales have been increasing their asset acquisitions, indicating potential long-term holding.
- Despite a declining crypto market liquidity, Bitcoin remains a primary liquidity magnet.
Whales have shown increased interest in acquiring more Bitcoin. Over the past few months, they have spent tens of millions on these acquisitions. The market sentiment suggests that these whales might be planning to hold the asset for an extended period.
Despite the market’s steady threshold, Bitcoin has not recorded any significant gains. It has moved within a tight range, with a maximum gain of 1% in the past month. However, the market insight suggests a potential shift in sentiment. Bitcoin’s value could rise as whales continue to accumulate the asset.
Whale Interest and Institutional Moves
Whales, known for controlling a significant portion of any asset, have shown renewed interest in Bitcoin. Since early March, new whales have entered the market and started acquiring Bitcoin. Approximately 60 investors have each purchased no less than 1,000 Bitcoin, totaling around $85 million.
This influx occurred when BTC was trading well below its all-time high, suggesting undervaluation in the eyes of large investors. This increase in whale participation is noteworthy, especially considering the overall decline in crypto market liquidity.
In the past two weeks, capital inflow has dropped from $8.2 billion to $2.38 billion. Despite the shrinking funds entering the market, assets receiving liquidity become more interesting as they are likely to outperform others. Whale activity in BTC confirms it may continue to lead market gains.
Institutional investors have also slowed their selling and ended the week with inflows into Bitcoin ETFs (exchange-traded funds). This group bought $106.90 million worth of BTC by the week’s end. If the accumulation by whales and institutions continues, Bitcoin’s value could increase, potentially leading to a rally.
Long-Term Traders and Bitcoin
To determine whether this accumulation is temporary or sustainable, the behavior of long-term holders was examined. Using Bitcoin’s Coin Days Destroyed (CDD) metric, which indicates whether long-term holders are selling or holding, it was found that the latter is true. The CDD trended near zero, implying long-term holders were not selling but continued to hold their positions.
With whales accumulating, institutions rotating back in, and long-term holders staying put, Bitcoin has emerged as the primary liquidity magnet in a drying market. If these tailwinds persist, BTC may not just hold steady—it could be gearing up for its next rally.
