Bitcoin whales in a predicament as prices hover near $30k: To buy or to sell?
- BTC whales have traded divergently as price oscillates within $28,000 to $32,000 ranges.
- With a surge in BTC profits in the past few months, whales have increasingly sent their holdings to exchanges.
For the past four months, Bitcoin [BTC] has been consistently trading within the range of $28,000 to $32,000. As the king coin lingers within a narrow price range, various cohorts of BTC whales have been making distinct trading moves, Glassnode found in its new report.
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Some sowed while others slept
Glassnode found that in the last month, the different sub-groups of BTC whales exhibited varied behaviors as the coin’s price faced resistance at the $30,000 psychological price mark.
Whales that held between 1,000 to 10,000 BTC adopted a bullish approach as they increased their balance by about 33,800 BTC. Likewise, whales with over 100,000 BTC increased their holdings by 6,600 BTC.
However, holders of 10,000 to 100,000 BTC adopted a bearish approach, reducing their balance by 49,000 BTC. Due to this, the period under review was marked by a “net reduction of just -8.7k BTC,” Glassnode found.
However, while aggregate balance change remained relatively flat, the report noted that whale entities might be moving funds amongst themselves on crypto exchanges as “there are significant changes taking place both internally and via exchange flows.”
To test its theory, Glassnode considered BTC’s Whale Reshuffling metric on a 30-day moving average for two whale subdivisions: those with over 10,000 BTC and those with 1,000 to 10,000 BTC.
It found periods of strong inverse correlations of -0.55 or less, indicating instances of balance shifts between the two groups. These periods coincided with the times when BTC’s price approached the $30,000 range.
This led Glassnode to conclude:
“This suggests that whales have indeed exhibited a relatively neutral balance change of late, with much of their recent activity being reshuffling via exchanges.”
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With BTC’s MVRV ratio still in the profitable region, all cohorts of BTC whales have sent varying amounts of their holdings to crypto exchanges for onward sales. Glassnode found that the coin’s recent rally caused whale inflow volumes to surge “quite significantly” to over 16,300 BTC daily.
“This is a whale dominance of 41% of all exchange inflows, which is comparable to both the LUNA crash (39%) and the failure of FTX (33%).”
Over the past five years, whale-to-exchange net flows have generally remained around ±5,000 BTC daily. However, in June and July of this year, there has been a sustained increase in whale inflows to exchanges, with a bias towards inflows ranging from 4,000 to 6,500 BTC per day.