Bitcoin: Are whales taking a festive break?

• Coinbase Premium was on a downtrend in December.
• Whales had significantly reduced their long exposure.

Bitcoin [BTC] climbed back above $43,000 in the last 24 hours of trading, with the market poised to retreat for end-year festivities on a high. As of this writing, BTC was at $42, 931 with a significant 24-hour gain of 4.51%, as per CoinMarketCap.

Nearly $26 billion worth of BTCs exchanged hands at the time of writing, causing a 38.54% spike in daily trading volume.

Trading activity was most likely driven by greedy buyers, as observed by AMBCrypto using Hyblock Capital’s data. The traders hoped to multiply their investments come January 2024 when several spot Bitcoin ETF applications could be green-lighted.

Source: Hyblock Capital

However, amidst the upbeat mood, some alarming signals drew the attention of market experts.

U.S. whales not as bullish as they were

Coinbase Premium, one of the popular indicators for tracking institutional whale’s movement, showed signs of bearishness.

According to AMBCrypto’s analysis of the metric created by CryptoQuant, a sharp fall in U.S. investors’ accumulation patterns was observed over the last week.

Source: CryptoQuant

Coinbase is the largest cryptocurrency exchange in the U.S. and the first choice for professional investors to trade in digital assets.

The decreasing trend therefore suggested that whales weren’t buying much as regular, or possibly selling off their holdings.

Observing the cold shoulder from whales, CryptoQuant stated,

“Consequently, when Bitcoin’s price is on the rise amid high open interest and a declining Coinbase Premium Index, it frequently signals an overheated market.”

A larger trend?

AMBCrypto scanned the Whale vs. Retail Delta indicator from Hyblock Capital and noted a similar story at Binance [BNB]. Whales had significantly reduced their long exposure in December.

Source: Hyblock Capital

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Moreover, the Open Interest (OI) in BTC futures on the world’s largest Bitcoin derivatives exchange, CME, fell 8% over the last week. CME’s standard Bitcoin Futures contract is worth five BTC and a barometer of institutional interest in cryptocurrencies.

Source: Coinglass

It remains to be seen if this is just a year-end blip or part of a developing trend that could extend into 2024 as well.