- Cryptocurrency market has been experiencing a significant shift in terms of where large-value Bitcoin transactions are taking place.
- The dominance of transactions above $10 million worth of Bitcoin has dropped from 42.8% to 18.8%.
BTC Volume from whales (transactions of more than 10 million USD) has seen a steep decline over the past few months. This drop was particularly visible following the collapse of the crypto derivatives exchange FTX.
This transaction group had a dominance of 42.8% back in November last year. However, according to CryptoMonday.de, the percentage of activity has fallen to 18.8%, the same as in December 2020.
This indicates that the whales’ activity has reset to pre-2021 bull run levels. This could mean that the whales already exhausted their selling appetite during the FTX crash and are no longer interested in selling Bitcoin.
According to CryptoMonday CEO Jonathan Merry:
CryptoMonday CEO Jonathan MerryIt’s possible that whales are taking a break from selling. If this is the case, we could see the dominance of these transactions increase when Bitcoin bulls make their next move. Bitcoin could find a new surge in interest from whales if the price continues to increase. This could fuel further gains for Bitcoin and the rest of the crypto market.
Return of Bullish Trend
During the 2018-2019 bear market, whales‘ power fell to low levels as cyclical bottoms were attained. This indicates hopefulness since its current level mirrors those observed during prior bull markets.
Hence, if the metric shows any significant improvements in the volume of these transactions, then Bitcoin could see a return of some bullish trend. This can be seen as the whales entering back into the market and buying Bitcoin, thereby driving up its price.
Bitcoin Price
Investors should also keep in mind that Bitcoin is currently trading at approximately 20% lower than its average cost basis on-chain, which has only happened at or near the local bottom of Bitcoin market cycles.
Therefore, any potential bullish trend may present an opportunity for investors to purchase Bitcoin at a low exchange rate and potentially experience tremendous returns in the long term.
For now, it remains to be seen how the market will react to this shift in whale behavior. Nevertheless, investors need to stay alert and take profit from any potential opportunities that may arise.
