Whales Continue to Accumulate Bitcoin Despite Price Fluctuations

Crypto Whales Scoop Up $3 Billion Worth of Bitcoin (BTC) This Month through Accumulation

In January, data reveals that crypto whales have gathered a whopping $3 billion worth of Bitcoin.

🐳 Crypto Whales Accumulate $3 Billion in Bitcoin in January, Data Shows

Last updated: January 29, 2024 06:20 EST | 2 min read

Source: Ruholamin Haqshanas

Large investors in the cryptocurrency market, known as crypto whales, have been busy accumulating Bitcoin (BTC) this month, amassing a total of $3 billion worth of the leading cryptocurrency.

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According to data from onchain analytics firm IntoTheBlock, the amount of Bitcoin held in whale wallets has increased by approximately 76,000 BTC, bringing the total holdings of these whales to nearly 7.8 million BTC.

But what exactly are crypto whales? And why are they accumulating Bitcoin? Let’s dive deeper into the sea of crypto!

Whales Exploit Bitcoin Dip to Accumulate More

Bitcoin started the month on a positive note, reaching highs above $48,900 on January 11 following the launch of U.S.-based spot exchange-traded funds (ETFs).

However, prices faced downward pressure and dipped to lows near $38,500 last week as investors in the Grayscale Bitcoin Trust (GBTC), a popular crypto investment vehicle, decided to take profits.

Seizing the opportunity, some whales took advantage of the lower valuations and acquired more Bitcoin through the Bitfinex cryptocurrency exchange.

“While bitcoin ETFs have seen net inflows of $820 million, Bitcoin whales have seen an increase of approximately $3 billion (76,000 BTC) so far in 2024,” IntoTheBlock said in its weekly newsletter.

Source: Midjourney

This data indicates that despite the price fluctuations, whales have shown confidence in the long-term prospects of the cryptocurrency and have continued to accumulate more bitcoin during the dips.

So, what does this mean for the overall market? And how will the upcoming spot ETFs impact the whale’s influence? Let’s take a closer look!

Crypto Whale Impact on the Market to Diminish After Spot ETFs

Aurelie Barthere, Principal Research Analyst at Nansen, believes the approval of spot Bitcoin ETFs will specifically impact crypto whales, who control a large share of the current token supply and wield unmatched influence in spot markets.

“We know that crypto token ownership is very skewed, with ‘whale’ wallets owning a large share of the token supply,” Barthere said in a recent interview with Blocking.net.com.

“Any change in that structure would probably reduce price volatility in the long term, intuitively.”

She also opined that the arrival of ETFs will bring more liquidity to the spot markets, which could lead to a more stable market.

Regarding the short-term performance of these ETFs, Barthere expects lower-fee ETFs to attract more inflows.

The competitive landscape among Bitcoin spot ETF providers, according to Barthere, will be shaped by factors like reputation, size, existing footprint, and management fees.

JPMorgan analysts have also predicted that the success of these newly created ETFs will hinge on fees and liquidity.

Given the high 1.5% fees associated with GBTC, they expect significant outflows from this Bitcoin trust.

🔮 Future Outlook and Investment Recommendations

The surge in whale accumulation despite price fluctuations indicates a strong belief in the potential of Bitcoin. With the launch of spot ETFs, whales may see their influence diminish over time, leading to a more stable market.

If these ETFs continue to gain traction, attracting substantial investments, we could see the price of Bitcoin soaring to new heights. Several observers and investment banks have predicted a potential price target of $100,000 by the end of 2024.

However, it’s worth mentioning that cryptocurrency markets are volatile and speculative. It’s important for investors to conduct thorough research and consider various factors before making any investment decisions.

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🗨️ Want to learn more about Bitcoin? Have any burning questions? Check out the Q&A section below!

Q&A

Q: What are crypto whales? A: Crypto whales refer to large investors who hold a significant amount of Bitcoin or other cryptocurrencies. These individuals or entities possess substantial wealth and have the power to influence the market due to the size of their holdings.

Q: Why are crypto whales accumulating Bitcoin? A: Crypto whales are accumulating Bitcoin due to their belief in the long-term potential of the cryptocurrency. Despite price fluctuations, they view Bitcoin as a valuable asset and are confident in its ability to grow in value over time.

Q: How will the launch of spot ETFs impact the influence of crypto whales? A: The arrival of spot ETFs is expected to diminish the influence of crypto whales in the market. These ETFs will bring more liquidity to the spot markets, reducing price volatility and potentially leading to a more stable environment.

Q: What factors will shape the competitive landscape among Bitcoin spot ETF providers? A: Reputation, size, existing footprint, and management fees will be crucial factors in shaping the competitive landscape among Bitcoin spot ETF providers. Lower-fee ETFs are expected to attract more inflows, while high fees could lead to significant outflows from existing investment vehicles like the Grayscale Bitcoin Trust (GBTC).

Q: What is the outlook for Bitcoin’s price based on these developments? A: The approval and success of spot ETFs could contribute to a surge in Bitcoin’s price. Multiple observers and investment banks have predicted a potential price target of $100,000 by the end of 2024. However, it’s important to consider the volatile nature of cryptocurrency markets and conduct thorough research before making any investment decisions.

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Disclaimer: The information provided in this article is for informational purposes only and should not be taken as financial or investment advice. Always conduct your own research and consult with a professional before making any investment decisions.

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