Bitcoin sees sharp drop in direct ownership – ETF effect?
Impatient investors dumped their Bitcoins and exited the market owing to price stagnancy.
- Non-zero Bitcoin wallets have declined drastically in the last two weeks.
- Whale entities have risen more than 6% since the ETF approvals.
Bitcoin’s [BTC] direct ownership has been significantly impacted ever since the spot exchange-traded funds (ETFs) started trading in the U.S. market.
According to on-chain analytics firm Santiment, the total number of non-zero Bitcoin wallets has declined drastically in the last two weeks.
In fact, nearly 469K wallets were no longer holding any coins compared to the 21st of January.
Are these factors to blame?
Santiment attributed the dip to Bitcoin’s lower-than-expected performance on the price charts and less interest in direct ownership of the asset.
Indeed, the king coin has wobbled in a narrow trading range of $42.7K-$43.5K for much of the last four weeks, AMBCrypto spotted using CoinMarketCap data.
The price stagnation frustrated traders who had entered the market expecting quick returns following the ETF approvals. Eventually, many among this impatient lot dumped their Bitcoins and departed.
Additionally, the green lighting of spot ETFs provided a convenient way to trade Bitcoins without the hassles of cryptocurrency wallets and private keys.
This arrangement could have made many existing users consider indirect Bitcoin investing.
According to data from SoSo Value, the new spot ETFs have seen net inflows of $1.63 billion as of the 6th of February, lending credence to the argument made above.
Whales remain supportive
In stark contrast to the impatient retail investors, wealthy owners continued to show faith in the long-term prospects of Bitcoin.
As per AMBCrypto’s examination of Glassnode’s data, unique entities holding at least 1K coins have rose more than 6% since the ETF approvals.
The confidence shown by whale investors could eventually drive retail ownership in the near term.
Broader sentiment remains bullish
In a statement shared with AMBCrypto, Shivam Thakral, CEO of Indian cryptocurrency exchange BuyUcoin concurred with this, highlighting positive institutional sentiments around Bitcoin leading to the halving.
Read BTC’s Price Prediction 2024-25
He remarked,
“The Bitcoin spot ETF craze has not slowed down as BlackRock and Fidelity now own a combined of 138,489 BTC which is roughly worth around $5.9 billion in Bitcoin. All these moves only reflect positive institutional sentiments around Bitcoin before the halving.”
Meanwhile, the broader market sentiment for Bitcoin was of greed, as noted by AMBCrypto through Hyblock Capital’s data. This fueled hopes that accumulation would rise further in the days ahead.
