Large Bitcoin holders increased their positions to a four-month high with 1,384 wallets holding at least 1,000 BTC. At the same time, the number of individual investors with less than 1 BTC decreased to 977,420, the lowest in the year.
The discrepancy highlights a recurring pattern in which experienced whales accumulate during economic downturns, while smaller holders get scared and retreat.
Whale accumulation accelerates during market correction
According to data from Glassnode, the number of wallets holding at least 1,000 BTC increased from 1,354 three weeks ago to 1,384 this week, an increase of 2.2%. This number is the highest for large holder wallets in four months and suggests renewed confidence among institutional and high-net-worth investors despite the market-wide turmoil.
Meanwhile, wallets with 1 BTC or less decreased to 977,420, down from 980,577 in late October. This marks the lowest level of participation by smallholders in years. This follows the typical pattern of inexperienced investors capitulating during price corrections.
Bitcoin endured the third-biggest drawdown of the current cycle, falling more than 25% from its all-time high six weeks ago. Bitcoin opened near $92,600 on Wednesday, but traded in a volatile range between $92,200 and $92,800 during morning trading in Asian time, showing typical volatility as traders swing between support and resistance.
Historical trends suggest that whales accumulate during retail sales, often preceding stabilization. Currently, only 7.6% of the supply of short-term holders is profitable, a level commonly seen at cycle lows. Furthermore, the STH realized profit and loss ratio was below 0.20. This is another indicator that often coincides with market bottoms.
Circulation of capital within the crypto market
The Crypto Fear and Greed Index has remained at 11 out of 100 for two days, reflecting the deep fear across the market. Social media sentiment has become extremely negative. Traders are sharing memes about a return to traditional work and expressing doubts about a rapid recovery.
According to the Bitcoin long/short ratio chart from Coinglass, the overall trend shows sustained bearish pressure, with traders reiterating positions towards a price decline. However, sentiment occasionally returned to an optimistic direction before returning to primarily negative expectations.
Some market observers see this extreme pessimism as a contrarian signal. Sentiment is compressed, derivatives markets become less leveraged, and whale accumulation continues. According to Bitfinex’s on-chain analysis, the sell-off is clear, with capital circulating within the crypto market rather than flowing out completely.
BTC/USDT open interest is around 100,000, indicating strong trader participation despite the price decline. This scenario (rising open interest and falling price) typically indicates bearish sentiment that can be caused by aggressive short selling. However, the pace of sales and realized losses has begun to stabilize, suggesting a possible move towards consolidation.
Bob Diamond, former CEO of Barclays and current head of Atlas Merchant Capital, sees the recent turmoil in global asset markets as a healthy correction and not the start of a full-blown bear market. Diamond points out that investors are still figuring out how to price risk assets amid rapid technological change.
As Bitcoin bottoms out in late 2025, a classic market structure will form between whale accumulation and retail sales. The coming weeks should reveal whether trust in institutions is enough to stabilize markets, or whether fear continues to dominate trading.
The article Bitcoin whale wallets soar to 4-month high as retail investors withdraw appeared first on BeInCrypto.
