Concerns regarding a bear market have escalated significantly within the community due to Bitcoin‘s ongoing difficulties amidst bearish conditions, alongside a more than 20% drop in the overall crypto market cap over recent months. While volatility appears to be on the rise, major investors remain optimistic about BTC’s future as they continue to acquire more coins.
Whale Investors Accumulate Bitcoin in Significant Quantities
Recently, Bitcoin has experienced substantial downturns, with the possibility of further declines. Retail investors have shown fear and uncertainty amid the broader market’s declining performance, leading many to sell off their holdings.
Nevertheless, substantial investors, often referred to as whales, have maintained a positive outlook, rapidly gathering the flagship asset in these challenging conditions. A market analyst known as Caueconomy highlighted this encouraging trend in a recent report based on insights from the prominent on-chain data and analytics platform, CryptoQuant.
In particular, these whales have been acquiring significant amounts of Bitcoin over the past month, indicating strong belief in its future potential. During this timeframe, large investors accumulated over 65,000 BTC despite the ongoing price corrections.
This trend reflects strong buying pressure among these investors, fostering a positive atmosphere for the flagship asset. Although this development may not yield immediate results on price in the short term, it indicates absorption by major players, excluding miners and crypto exchanges.
Should this trend continue for several more weeks, the expert noted that the pattern would signal sustained purchasing power, similar to the accumulation seen from November to December last year. Compared to short accumulation phases followed by distribution, this ongoing activity among significant investors is more vital.
Meanwhile, the ongoing accumulation by whales could act as a bullish signal, paving the way for the next significant Bitcoin movement. With current price fluctuations, it appears that whales are capitalizing on BTC’s decline as the digital asset hovers around the $80,000 mark.
New BTC Investors Are Liquidating Their Holdings
While large investors display an encouraging trend, a contrasting bearish trend is emerging among newer BTC buyers. Leading on-chain analytics and financial service provider Glassnode reported that Bitcoin’s ongoing sell pressure is predominantly coming from these groups.
This wave of selling is applying downward pressure on Bitcoin’s price, hindering a sustained breakout in the near term. Additionally, increased volatility, weak demand, and liquidity constraints have hindered significant accumulation, raising the risk of a decline.
So far, Bitcoin’s Short-Term Holder SOPR metric indicates a rise in panic-driven selling. The metric has dropped notably below the break-even level of 1, signifying that recent buyers are feeling fear and recognizing their losses.
Featured image from Unsplash, chart from Tradingview.com
Editorial Process for Bitcoinist focuses on providing thoroughly researched, accurate, and impartial content. We adhere to strict sourcing standards, with each page undergoing rigorous review by our team of leading technology experts and experienced editors. This approach guarantees the integrity, relevance, and value of our content for our readers.
