Over the past month, the price of Bitcoin has experienced a lot of volatility, culminating in a total loss of 3.09% according to Data from CoinMarketCap. It is worth noting that despite intermittent price surges, the market-leading cryptocurrency failed to reclaim the $65,000 price zone throughout August. However,Amidst this bear market, institutional investors have taken the opportunity to strengthen their position in the Bitcoin market.
Bitcoin OTC Reserves Surge to Record High Since 2021
in Quick Share At CryptoQuant, an analyst with the username caueconomy reported an observation about institutional investors’ buying behavior in Bitcoin. By monitoring over-the-counter (OTC) Bitcoin address transactions, the analyst noted that these parties have been rapidly increasing their holdings in the past few weeks.
Institutional investors often prefer OTC trading over exchanges for large transactions because it allows them to buy or sell large amounts of cryptocurrencies without significantly moving the market price. According to caueconomy, these investors have now acquired 57,000 BTC, worth $3.65 billion, in the last 30 days, marking a buying range last seen in 2021.
The analyst noted that this buying activity is unusual as high levels of institutional OTC trading typically occur during periods of high volatility in contrast to the low price volatility that has been largely present in the BTC market over the past few weeks.
However, Caueconomy assumes that this large-scale acquisition may be aimed at a planned disposal of tokens in cases of “negative” market reaction. Conversely, whales and institutional investors buying large amounts of assets, especially during market declines, is a bullish signal of confidence in future profitability.
Most recently, the leading cryptocurrency saw a price surge on Friday, after US Federal Reserve Chairman Jerome Powell confirmed interest rate cuts over the next few months. Bitcoin rose 4.84% to a peak of $64,879, just below the notable resistance area at $65,000.
Commenting on this development, Oto Shinohara, financial expert and managing director of asset investment firm Mesirow, said: expected It cut interest rates by 30 basis points in September and cut interest rates by 95 to 100 basis points in total by the end of 2024. If these expectations prove correct, demand for Bitcoin and other cryptocurrencies is expected to rise in the coming months, which could translate into significant profits for institutional investors.
BTC Price Overview
According to CoinMarketCap data, Bitcoin is trading at $63,905 with a price increase of 5.38% in the last 24 hours. At the same time, the daily trading volume of the asset increased by 64.53% and reached $42.94 billion.
Featured image from Coinformania, chart from Tradingview