On-chain data shows that Bitcoin whales have been participating in a significant net distribution over the past month, which could fuel Bitcoin’s bearish momentum.
Bitcoin Whales Sell Amid Bear Market
As analyst Ali pointed out in a new article, mail On X, BTC whales have been selling recently. The on-chain metric of interest here is “supply distribution” from analytics firm Santiment, which tracks the total amount of Bitcoin currently held by different wallet groups.
Addresses or investors are divided into these groups based on the number of tokens they hold in their balances. For example, the 1-10 group includes all wallets that hold between 1 and 10 bitcoins.
In the context of the current topic, we focus on the whale group, which is usually composed of cryptocurrency holders who own between 1,000 and 10,000 Bitcoin. At the current exchange rate, the lower end of this range translates to $55.4 million and the upper end to $554 million.
As such, these investors have huge holdings. The more holdings an entity has in the market, the more influence it has, so these giants are capable of carrying some power. As such, their behavior is worth watching.
Here is the chart shared by the analyst that shows the trend in the distribution of Bitcoin supply to whales specifically over the past month or so:
The value of the metric appears to have been going down over the last few weeks | Source: Santiment on X
As you can see in the chart above, the distribution of Bitcoin supply to whales has been on a downward trend over the past month. In total, these investors have lost a net 30,000 Bitcoin, worth over $1.65 billion at the moment.
The decline in the index has been particularly sharp in the past two days, suggesting that selling by these large entities is at least partly responsible for the cryptocurrency’s collapse.
Although whales have already participated in a large amount of distribution, it is difficult to say whether their appetite for selling has subsided. It is likely that more whale holders will become concerned about the bear market in the coming days and end up selling some of their holdings.
Therefore, the metric may be worth watching in the near future, as further declines on it could prolong the cryptocurrency’s bearish period. Of course, a reversal to the upside would be bullish instead, as it means that whales believe the price has dropped deep enough to provide a profitable entry point.
Bitcoin price
After falling more than 10% last week, Bitcoin has reached $55,000, a level the cryptocurrency last reached in late February.
The chart below shows the recent path of the asset.
Looks like the price of the coin has been on its way down recently | Source: BTCUSD on TradingView
Featured image by Dall-E, Santiment.net, chart by TradingView.com