contributor
Posted:
- Are Bitcoin Whales Really Accumulating? We explore data along the chain to find some answers.
- Bitcoin longs could be at risk of liquidation if the bears gain the upper hand.
Bitcoin [BTC] recovered by more than 3% during the trading session on September 2. Part of this achievement was the excitement caused by reports that whales were accumulating BTC.
However, the country’s inability to maintain strong momentum calls these reports into question.
According to Look at chainwhales have also moved Bitcoin to the stock exchange, despite healthy outflows. This could indicate that whales have tried to cause more volatility in the market.
Despite these reports, AMBCrypto also observed negative net flows from Bitcoin ETFs, which didn’t exactly inspire confidence.
These findings warranted an assessment of Bitcoin addresses to determine the level of accumulation.
Data from IntoTheBlock showed that addresses holding between $100,000 and $1 million in BTC dropped from just over 516,000 addresses on August 25 to over 486,500 addresses on September 2.
Source: IntoTheBlock
Addresses in the BTC range worth $1 million to $10 million also dropped from 100,540 addresses to 96,150 addresses during the same period.
Addresses holding more than $10 million worth of Bitcoin dropped from 100,440 addresses to 100,000 addresses.
A Bitcoin Price Inducer Setup?
The data confirmed that a significant number of whales contributed to the selling pressure. So the hype may have been a classic attempt at incitement, with the market getting excited and providing exit liquidity to the sellers.
This would explain Bitcoin’s limited upside and the struggle to sustain the recovery above $60,000.
Incentive levels are typically characterized by a surge in interest in leveraged positions. On August 2, we saw an accumulation of 25.582 million net longs near the bottom.
The figure was higher at 52.82 million net longs at a price level of $58,000.
Source: Hyblock Capital
The increase in the number of long positions indicated growing expectations of more upside potential. This also coincided with the resurgence of the need for leverage.
Bitcoin’s estimated leverage ratio bottomed on August 12, followed by a reversal.
This indicated that the market has embraced more leverage and could potentially move towards heavy liquidations in the event of another crash.
Source: CryptoQuant
Bitcoin was exchanging hands at $58,861 at the time of writing, after a discount of 0.47% in the past 24 hours.
Read Bitcoin’s [BTC] Price forecast 2024–2025
This indicated that the market is struggling to maintain momentum, and was consistent with whale selling pressure observed previously. It also highlighted the possibility of liquidations if the price moves lower.
The next 24 hours will be critical for Bitcoin as the market awaits the next FED decision on interest rates. This could result in a volatile second half of the week.