The CryptoQuant data shows that whales are buying the dips, as the BTC Netflow has entered a “deeply negative” zone since the price has dropped. The company’s data shows that at least 5,000 bitcoins have left centralised exchanges, with a USD value of $170 million. During the last price crash, the cryptocurrency community expressed support for bitcoin on social media. You can check this link for more details about a reputable trading platform.
In addition to this, Bitcoin whales are buying a dip in the correction to make up for their previous losses. While this might not seem like a big deal, the rise in whales’ numbers is indicative of institutional interest in the currency. The recent correction may be the start of a more significant uptrend, but it would be prudent to wait and see before jumping into the market.
In early February, Tesla announced its intention to purchase $1.5 billion worth of bitcoin. The price of bitcoin soared by 15%. The news of the purchase sent ripples through the cryptocurrency market, and many more ‘corporate’ entities will follow suit. Another example of this phenomenon is creating a division to buy bitcoins by the Norwegian company Aker. The Chinese company Meitu also bought Bitcoin worth $40 million.
HODL
Despite the massive price drop, some of the cryptocurrency community’s biggest supporters still buy Bitcoin. Many are expressing their support on social media. Thousands of bitcoins have been removed from centralised exchanges, amounting to over 170 million. While Bitcoin is still a huge part of the cryptocurrency market, rampant speculation is a major concern for most institutional investors.
These whales control 40% of the market and can manipulate the valuation of a currency. According to Business Insider’s latest report, many investors are buying more than ten thousand Bitcoins if the price drops. These investors are known as whales, and their actions can change the market within hours. If they are buying dips, they ensure that the price stays below their targeted $40000.
However, Bitcoin might already have peaked. To see if Bitcoin has peaked, you should look at on-chain metrics. While Bitcoin’s recent price correction seems to have spooked some whales, you can still make significant profits by watching the whales. These investors spent more than $2 billion in the last seven days.
Despite the recent price decline, long-term BTC holders are not discouraged and are bolstering the flagship cryptocurrency price. Several digital currency data feeds show that BTC Whales with more than 1,000 Bitcoin currently own 7.88 million BTC. That’s good news for prospective BTC investors. It’s the largest one-day BTC buy-in in history, and it’s a reassuring sign for long-term investors.
Impact of Bitcoin (BTC) whales
The impact of Bitcoin whales buying a dip in the correction and BTC price staying under $40000 is evident by the recent downturn in the cryptocurrency markets. Most of these buyers hold as many as a hundred or even a thousand units of Bitcoin.
Currently, the price of Bitcoin has fallen below $4000, which means over $2 billion has been spent on new units of digital gold. Despite the recent downtrend, whales are still buying up dips in the correction to gain a higher position in the cryptocurrency market.
The current price correction in the cryptocurrency market has caused more people to purchase Bitcoin using borrowed funds. These investors are taking a position called leverage longs. The exchange funding rate increases when investors open highly leveraged longs, which drives the price higher and creates a cascading effect that reverses the price. The effect of this trend is similar to the gold rush in the fiat world.
Final Words
The impact of the whales on bitcoin prices is clear. Despite a relatively small drop in price, a single trade by a whale can change the overall trajectory of the price by more than 15%. A single whale trade can overwhelm the movement of smaller investors. For example, on January 8, bitcoin reached a record high of $41,973 but recovered to just $32,170 by January 23.
While traditional institutions have not deliberately impacted the market, there is a new class of bitcoin investors that are not selling into dips or crashes. Rather, these investors accumulate bitcoin and use the narrative that bitcoin is “digital gold.”
