Bitcoin price is off to a strong start to the new year, topping $90,000 on Friday, January 2nd. This newfound momentum could be caused by a variety of factors, but on-chain experts pointed out that whale activity is not one of them.
A closer look: BTC Whale Holdings is actually falling
In a recent post on social media platform This conclusion is based on graphs of total whale stock and monthly rate of change, and total dolphin stock and monthly rate of change.
As the name suggests, the Total Whale Holdings and Monthly % Change chart shows the total balance of addresses with more than 1,000 coins and how it has changed over the past month. Meanwhile, the Dolphin total holdings vs. monthly change graph shows changes in investor balances between 100 and 1,000 BTC (taken from exchange-traded fund holdings).
What's even weirder is that Total Whale (and Dolphin) Holdings and Monthly % Change don't include exchange wallet addresses. According to Moreno, much of the Bitcoin whale data is skewed by exchanges consolidating many of their holdings into a small number of addresses with larger balances, explaining why whales appear to be in a reaccumulation phase recently.
Interestingly, if we remove the data for all exchange addresses, the data is actually skewed, as the total Bitcoin whale balance shows a decrease rather than an increase. The same trend can be seen in the graph of Dolphin total holdings and monthly percentage change at the bottom of the image below.
Source: @jjc_moreno on X
This decline in Bitcoin whale balances speaks to a decline in market demand and signals the beginning of a bear market. As seen in past cycles, the lack of apparent demand growth is the clearest sign that a correction phase in Bitcoin's price is imminent.
As of this writing, the price of BTC is around $90,320, reflecting an increase of over 2% in the past 24 hours.
Spot Bitcoin ETF suffers historic losses
Since its trading debut, the US Bitcoin ETF market has become a great way to gauge investor demand in the crypto market. However, market data has not been telling us anything good about the flagship cryptocurrency in recent weeks.
For context, tThe largest Bitcoin ETF, BlackRock Inc. it goesrecorded net outflows of about $244 million last week, the second consecutive week of outflows. The fund has now recorded net withdrawals in eight of the past 10 weeks, and only 20 weeks of weekly outflows since its inception two years ago.
According to recent data, crypto funds recorded net outflows of approximately $446 million last week, marking the sixth week of outflows in the past nine weeks.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from Unsplash, chart from TradingView
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