Whales Holding Large Amounts of Bitcoin are Responsible for Bull Market

Pexels

Whales Holding Large Amounts of Bitcoin are Responsible for Bull Market

Although Bitcoin whales have mostly been seen in a bad light, they could be useful in driving important events in the industry. According to Diar, Bitcoin whales who own at least 1000 BTC are responsible for bringing back the bull market that Bitcoin is currently enjoying.

Bitcoin price rise coincides with the accumulation

According to an analysis by Diar, there has been a steady increase in BTC being acquired by Bitcoin whales holding 1000 BTC or more. Those wallets currently hold 26% of the total Bitcoin circulating supply. Comparing the amount of Bitcoin amassed by these wallets in August 2018 when Bitcoin was also at $8,000 to the current amount, Diar said the addresses held under 20% of the circulating supply which has increased to 26% in less than a year.

Bitcoin held by Wallets with 1000-10,000 BTC

The number of Bitcoins held by these addresses significantly increased by December of 2018 when the cryptocurrency bottomed. This could be due to a major buy-in of the bottom for storage ahead of a possible bull market like the one Bitcoin is experiencing now. The increase in the number of Bitcoin held amounts to $6 billion more than what was held in August 2018.

In addition, 40% of mined Bitcoins in 2019 have been claimed by these wallets while retail wallets holding 0 to 100 BTC have also received an additional 126,000 BTC this year and the number of wallet addresses under this category has been on the increase as well. Retail wallets currently hold 38% of Bitcoin’s total circulating supply but are not responsible for the current price rally because they are quite stable, the report said.

Also read: Bitcoin [BTC] Reverses at $8550, Rejects First Attempt at a Pullback: Analyst

Interestingly though, on-chain transaction data suggests that there is a restricted supply of Bitcoins on exchanges which happen to own most of the major addresses. This is evident by the reduction in the amount of Bitcoin they hold which has declined from 21% of the total circulation to the current 16%.   So far, they have collectively lost 300,000 BTC since the start of 2018.

Bitcoin price
Source: Diar Research

BTC accumulation causes a price spike

The increase of 7% in the amount of BTC held by the major whales holding between 1000 and 10,000 BTC is responsible for the price surge, based on Diar’s data. This is a possibility as those BTC are nor lost but have been in the wallets and they have been quite active according to the report. If the holding of BTC has raised the price, what will be the implication of selling the accumulated BTC on the price? Is the market in danger of losing if the whales decide to sell?

Summary
Whale Bitcoin Addresses Holding Atleast 1000 BTC Responsible for Bull Market
Article Name
Whale Bitcoin Addresses Holding Atleast 1000 BTC Responsible for Bull Market
Description
Diar weekly newsletter has revealed statistics indicating that a steady rise in the number of BTC held in addresses with over 1,000 BTC. This has been the trend since the bear market started in 2018 and Diar concludes that the accumulation has led to the current bull makrket.
Author
Publisher Name
Coingape
Publisher Logo
Coingape is committed to following the highest standards of journalism, and therefore, it abides by a strict editorial policy. While CoinGape takes all the measures to ensure that the facts presented in its news articles are accurate.
Disclaimer The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.
Author: Ponvang Bulus

A cryptocurrency enthusiast, author, and investor with high motivation in cryptocurrency/blockchain research and writing. He loves birdwatching and traveling. Follow him on Twitter at @Ponvangbu

Post your comment...
Ponvang Bulus 62 Articles

A cryptocurrency enthusiast, author, and investor with high motivation in cryptocurrency/blockchain research and writing. He loves birdwatching and traveling. Follow him on Twitter at @Ponvangbu