Ultimate Resource On Bitcoin Whales (#GotBitcoin?)
BTC Dump: Pure Whale Manipulation. BTC Dump: Pure Whale Manipulation, Makes $15 MILLION! (#GotBitcoin?)
Following the recent decline in the Bitcoin price which has seen BTC go back below $8,000, questions have been asked about the manipulation of prices by whales. A recent whale move to Coinbase has led to speculations in the community.
The whale move in question occurred yesterday, with the whale moving 25,000 BTC ($213 million at the time of the first transfer) from an unknown wallet to Coinbase. The move coincided with a market dump that saw the price of Bitcoin drop dramatically.
Bitcoin saw a 9.21% decline in price over a 4 hour period, during the same time, the 25,000 BTC whale managed to dump their BTC on Coinbase.
What’s notable about the outgoing amounts is that they equal the 25,160 BTC incoming transaction. What is also worth noting is that the original transaction was valued at $213.36 million, and the outgoing transactions totalling the same amount of BTC, were estimated at roughly $200 million. Essentially the whale sold the top and immediately bought back the dump, netting a profit of $10 – $15 million in the process. There is also a $10 million USDT move shortly after the BTC outgoing whale moves, which could be the whale moving profits out of Coinbase.
About 20-30 mins before the dump, a whale moved 25k BTC (worth $215M) to Coinbase: link
About an hour after the dump, a whale moved 14k BTC (worth $112M) from Coinbase to another wallet: link
40 mins after that, a whale moved 11k BTC (worth $88M) from Coinbase to another wallet: link
15 mins after that, a whale moved 10M USDT from one wallet to another: link
If you do a little math and follow the timeline, it’s not hard to see that someone dumped 25k BTC for $215M and bought it back shortly after for $200M. In doing so, they pocketed $15M and walked away with the same amount of BTC as they started with.
Edit: For all those saying that no one was complaining when a whale entering the market drove the price us. No shit, all boats rise in that situation. In the one we’re talking about here, only one group of people benefit whereas the vast majority are negatively impacted. That’s the difference.
Bitcoin Whale Addresses Hit Highest Number Since August 2019
Large crypto investors, popularly known as “whales,” seem to be accumulating bitcoin amid the ongoing price rally.
The seven-day moving average of the number of addresses holding 10,000 bitcoins or more rose to 111 on Wednesday, the highest level since Aug. 2, 2019, according to blockchain intelligence firm Glassnode. That number has risen by more than 11% since early March.
“The increase in the number of BTC addresses with more than 10,000 BTC is likely the result of long-term holders coming back online to expand their holdings,” said Matthew Dibb, co-founder of Stack, a provider of cryptocurrency trackers and index funds.
Increased interest from long-term holders and large investors could be associated with the bullish narrative surrounding the macro factors and the upcoming reward halving.
“Some of these addresses may belong to high-net-worth individuals or groups, who are diversifying into bitcoin amid the ongoing coronavirus pandemic and ahead of the mining reward halving, due in the next two weeks,” said Wayne Chen, CEO of Interlapse Technologies and founder of Coincurve, a cryptocurrency purchasing, and spending platform.
Bitcoin’s supply is capped at 21 million and its monetary policy is pre-programmed to cut the pace of supply expansion by 50 percent every four years.
Hence, many advocates tout bitcoin as a safe haven asset and an inflation-hedge like gold. They claim the economic destruction caused by the coronavirus pandemic and the unprecedented money printing exercises undertaken by the global central banks and governments to bode well for bitcoin’s price.
“Amid the deteriorating economic outlook for the U.S. economy and the likelihood of an ever-increasing monetary supply, which weakens the U.S. dollar and stokes inflation fears, we believe bitcoin could easily test previous highs above $19,000 as investors look for safe havens away from traditional assets,” said, Simon Peters, analyst and crypto asset expert at global investment platform eToro.
Such bullish predictions have been doing the rounds for more than six weeks now and could have enticed large investors to add bitcoins to their portfolio.
Further, expectations that the mining reward halving, due on May 12, would put bitcoin on a long-term bullish trend could be the reason for the rise in the number of so-called “whale addresses.”
Bitcoin undergoes a process called mining reward halving every four years, which controls inflation by reducing mining rewards by 50%. Following the May 2020 halving, the reward per block mined will drop from 12.5 BTC to 6.25 BTC.
Many investors anticipate the cryptocurrency’s price would go up after halving, as the asset would become more scarce to satisfy the demand. Reinforcing this belief is the historical data, which shows bitcoin experienced solid bull runs in the year following previous halvings.
“At the first halving in November 2012, the price went from $11 to over $1100 a coin a year later. Then after the second halving in July 2016, bitcoin went from $600 to over $20,000 by the end of 2017,” said George McDonaugh, managing director and co-founder of publicly listed cryptocurrency and blockchain investment firm KR1 plc.
However, reward halving also means a 50% reduction in miners’ revenue. So, if the price fails to rally sharply post-halving, small and inefficient miners may shut down operations and offload their holdings to cover costs, leading to a price drop.
Bullish Narrative Reinforced
Bitcoin was trading near $8,900 at press time, a 130% gain from the low of $3,867 reached on March 13, according to CoinDesk’s Bitcoin Price Index.
Bitcoin is now reporting a bigger year-to-date gain compared to gold. While the cryptocurrency is up 21%, the yellow metal has seen a 12% increase.
The year-to-date performance may reinforce the narrative that bitcoin is a hedge against global economic malaise, fiscal and monetary indiscipline and could continue to draw demand from both small and large investors.
“The year-to-date performance indicates that investors’ awareness of the digital asset has increased and its role as a potential diversification vehicle for traditional portfolios has been underscored by its strong recovery from its recent lows, relative to more traditional markets. We expect this strength to persist as Bitcoin continues to take pole position in the race,” said Stack’s Dibb.
Not A Perfect Indicator
The rise in the number of unique addresses holding more than 10,000 bitcoins does not necessarily mean an influx of new whales into the market. After all, a single investor can hold multiple addresses.
Further, cryptocurrency exchanges tend to hold large balances. For instance, two of the top five addresses on the rich list (a table of the addresses holding the most bitcoins), published by bitinfocharts.com, belong to prominent exchanges Huobi and Bitfinex.
“Some of these addresses are owned by top exchanges which usually hold large reserves in their cold wallet. So this doesn’t necessarily signal a clear behavior for market activity,” said Coincurve’s Chen.
Whale Sightings Become Scarce, Removing Downward Pressure On Bitcoin: Analyst
A lack of whales with bitcoin (BTC) aplenty to sell may be clearing the way for the price of the leading cryptocurrency to rise further, according to CryptoQuant Chief Executive Ki Young Ju.
$BTC whales seem exhausted to sell. Fewer whales are depositing to exchanges.
I think this bull-run will continue as institutional investors keep buying and Exchange Whale Ratio keeps below 85%.
— Ki Young Ju 주기영 (@ki_young_ju) December 28, 2020
* Fewer “whales” – bitcoin holders possessing large balances – are depositing bitcoin (BTC) onto exchanges the past few days, according to CryptoQuant, a crypto market data aggregator.
* CryptoQuant’s “Exchange Whale Ratio,” which is calculated by dividing top 10 bitcoin inflow transactions in an hour by total BTC exchange inflows, has dropped below 85%.
* From Dec. 8-22, the ratio stayed above 85% as whales were likely profit-taking during the bull run, which reached a price zenith of $28,352 Sunday according to CoinDesk 20 data.
* Some market exhaustion is expected, according to Young Ju, but he expects institutions to pick up some of the slack.
* “I think this bull run will continue as institutional investors keep buying and Exchange Whale Ratio keeps below 85%,” Young Ju noted on Twitter.
Bitcoin Whales Are Buying More Aggressively Since Christmas, Data Finds
High-net-worth investors, or whales, have been buying Bitcoin more aggressively since Christmas, on-chain data show.
Bitcoin (BTC) whales have been buying more since Christmas, on-chain data shows. This indicates that high-net-worth investors are continuing to eat up the supply of BTC.
It is nearly impossible to segregate institutional investors from individual investors through on-chain data. However, the trend shows that investors with large capital are increasingly entering into the Bitcoin market despite its rally.
Why Are Whales Continuing To Buy More Bitcoin?
According to the analysts at Santiment, around $647 million worth of Bitcoin likely transferred from small addresses to large addresses.
Addresses holding over 1,000 BTC or more are considered whales by many analysts, as 1,000 BTC is equivalent to over $27 million at the current price at $27,100. The analysts wrote:
“Over the last 48 hours since Christmas, #Bitcoin addresses with 1,000 or more $BTC now own 0.13% more of the supply that smaller addresses did previously. This is about 24,158 tokens, which translates to $647.7M at the time of this writing.”
Bitcoin has increased nearly threefold since mid-2020, and the upside for BTC is arguably limited in the near future.
Still, most on-chain data points show that fewer whales are selling across major exchanges. Ki Young Ju, CEO at CryptoQuant, said:
“BTC whales seem exhausted to sell. Fewer whales are depositing to exchanges. I think this bull-run will continue as institutional investors keep buying and Exchange Whale Ratio keeps below 85%.”
There are two main reasons why whales might be accumulating Bitcoin at the current price range.
First, in spite of Bitcoin’s overextended rally, whales might believe that the psychological barrier at $30,000 will break. If so, options data suggests $36,000 could be a likely target in the near term.
Second, there is no solid reason to anticipate a major correction coming, apart from the CME gap and the high futures market funding rate.
But if Bitcoin consolidates after each rally, as seen in the past two days, then the funding rate would likely normalize. When that happens, the derivatives market would be less overheated, raising the probability of a new rally.
A pseudonymous trader known as “Byzantine General” said that the market is currently giving conflicting signals. Both long and short contract holders are being aggressive, which makes both a long and short squeeze possible. He said:
“Such conflicting signals rn. Both longs & shorts are being overly aggressive lol. I should probably sit on my hands.”
The Likely Near-Term Scenario Is More Consolidation
Typically, the price of Bitcoin on Coinbase is higher than Binance and other Tether-reliant exchanges. However, in the past week, Bitcoin has been trading slightly lower on Coinbase, by around $20 to $30.
Although the gap is small, it shows that the U.S., which drove Bitcoin’s rally throughout December, might be seeing slowing buyer demand. But the Asian market and the derivatives market are seeing an increase in buyer demand.
Considering that the demand for Bitcoin in the U.S. spot market appears to be cooling down, Bitcoin could consolidate for longer with lower volatility.
Number Of People Holding Lots Of Bitcoin Surges In Rare ‘Whale-Spawning Season’Large investors continue to accumulate bitcoin, possibly putting upward pressure on the cryptocurrency’s price.The number of whale entities – clusters of crypto wallet addresses held by a single network participant holding at least 1,000 bitcoin – rose to a new record high of 1,994 on Wednesday. The previous peak of 1,969 reached in 2016 was surpassed on Dec. 18, according to data source Glassnode.
The metric has increased by over 16% this year and 7.3% this quarter alone. Bitcoin’s price has rallied by over 300% in 2020 and 160% in the October-December period. At press time, the leading cryptocurrency is changing hands at over $28,800 per bitcoin, after reaching an all-time high of $29,280 on Wednesday, as per CoinDesk 20 data.
“We have just entered a rare whale-spawning season, with ultra-high net worth and institutions recognizing the last call to build significant stores of bitcoin,” Jehan Chu, co-founder and managing partner at Hong Kong-based trading firm Kenetic Capital, told CoinDesk. “The final land grab has started, and by this time next year accumulating [over] 1,000 bitcoin will be nearly impossible for most people.”
The steep rise in the whale entity population validates the popular narrative that increased participation by large investors has fueled bitcoin’s recent rally.
According to Sumit Gupta, CEO and co-founder of CoinDCX, the data shows the cryptocurrency is going through a shift from being a speculative asset to a macro investment asset, and that switch is mainly being driven by the increasing acceptance from global institutions as well as investors from around the world.
JPMorgan analysts say the recent bitcoin purchases by insurance firm MassMutual indicate growing mainstream adoption and could have a bearing on gold in the long run.
Bitcoin Price Volatility Spikes As BTC Whales Sell Each New High
Data suggest Bitcoin’s price drops at each new all-time high are the result of “mega whales” selling into liquidity.
Bitcoin price has re-established the $40,000 level as support but as bull push toward a new all-time high the possibility of another sharp sell-off looms.
According to analysts at Material Indicators, a crypto analytics company, mega-whales sold off steeply when Bitcoin hit $40,000 on Jan. 7. This led to a quick 10% drop to the $36,000 area over the next few hours.
The dip was quickly bought up, eventually pushing the price above $41,000 in the next 12 hours. However, BTC saw another large drop after setting another all-time high at $42,000, and at the time of writing the top-ranked digital asset is trading at $40,800. According to Material Indicators:
“So, it looks like mega-whales started selling after that dump at around 2am UTC, and continued selling on the spikes. My guess is they expected more downside. They did not really participate in the rally back up to 42k, which would further support that point.”
In the most recent pullback from $42,000 to $40,000, Fred explained that smaller whales, who hold $100,000 to $1 million, began to take profit. He noted:
“However, now, they have started buying again. Presumably to break the 42k resistance. Only this time, it seems to be the normal whales ($100k – $1M class) who started taking profit.”
Considering that at times during the last week Bitcoin price has traded higher on Coinbase, it is clear that there is large buyer demand coming from the U.S.
This suggests that there is a battle between normal whales taking profit and new buyers in the U.S. market. The sharp rejections from each new all-time high also signals that whales may be aggressively taking profit as soon as Bitcoin hits a new record high
As such, it is important that the demand for Bitcoin from the U.S. is sustained in the near term. Otherwise, the high level of selling pressure from whales could cause BTC to see a correction in the foreseeable future.
Where could Bitcoin go from here?
Bitcoin currently has extremely strong technical momentum that continues to drive the price higher. For this reason, traders are reluctant to short it, but some have started to take profits.
In the short term, one concern for Bitcoin is the potential recovery of the U.S. dollar. A pseudonymous trader known as “Cantering Clark” pinpointed the rebound of the U.S. dollar and the decline of precious metals. He said:
“So the question is, with the $DXY finding a floor surprisingly, and metals responding by getting nuked, does $BTC hold well?”
The U.S. dollar index (DXY) is hovering at a support level on the monthly chart. Alternative stores of value, like Bitcoin and gold, are priced against the dollar. Hence, if the dollar begins to move upward, the risk of a BTC correction could intensify.