On-chain data shows the Bitcoin whales have accumulated 84,897 BTC during the last five weeks, something that could be bullish for the price.
Bitcoin Whales Have Been Growing Their Holdings Recently
According to data from the on-chain analytics firm Santiment, when whales last accumulated like this, the price jumped about 34%. The relevant indicator here is the “BTC Supply Distribution,” which tells us about the total amount (as well as the percentage) of the Bitcoin supply that each wallet group in the market is holding currently.
The addresses on the network are divided into these wallet groups based on the number of coins that they are carrying in their balances at the moment. The 10-100 coins cohort, for instance, includes all addresses that are holding at least 10 and at most 100 BTC currently.
Naturally, if the Supply Distribution is applied to this specific group, it would measure the amount of the supply that wallets satisfying this condition are holding as a whole.
Now, in the context of the current discussion, the Bitcoin cohort of interest is the “whale” group. Whales are humongous entities that carry at least 1,000 BTC ($26.8 million at the current exchange rate) and at most 10,000 BTC ($268 million) in their wallets. This means that the 1,000-10,000 coins group is of relevance here.
The below chart shows the trend in the Bitcoin Supply Distribution for this particular cohort over the past year:
The value of the metric seems to have been on the rise in recent days | Source: Santiment on Twitter
As displayed in the graph, the Bitcoin Supply Distribution for the whale group has observed an overall uptrend recently. During the last five weeks, these humongous investors have added around 84,897 BTC to their holdings, which is worth around $2.2 billion.
Generally, the behavior followed by the whales can be something to watch out for, as their massive holdings mean that they have the potential to cause noticeable ripples in the market through their moves.
An example of this can be clearly seen in the chart. In the leadup to and during the rally back in January of this year, the whales displayed a trend of accumulation and grew their supplies by around 71,690 BTC.
While this accumulation occurred, the price of Bitcoin started its surge and had risen by more than 34% by the time the whales slowed down their buying spree. This trend highlights how the buying pressure from this cohort can help the price go up.
Since the whales have started their latest accumulation cycle, however, the price has only declined or moved sideways so far. But given that these holders are continuing to expand their reserves, it suggests that they think the current relatively low prices provide a good buying opportunity.
It’s unknown when this bullish conviction held by the whales might translate to the price, but the trend could be a positive sign for the long-term sustainability of the rally.
At the time of writing, Bitcoin is trading around $26,700, down 2% in the last week.
BTC has moved sideways recently | Source: BTCUSD on TradingView
Featured image from Vivek Kumar on Unsplash.com, charts from TradingView.com, Santiment.net