Large Bitcoin Whales Are In Decline While Little Whales Flex Their Muscles

By ZyCrypto - 1 month ago - Reading Time: 2 minutes

Large Bitcoin Whales Are In Decline While Little Whales Flex Their Muscles

The number of accounts holding 10,000 BTC or less has dropped to its lowest ebb in 8 years.On the bright side, the number of addresses that own between 100-1,000 BTC has gained momentum in recent days.Several reasons are responsible for this trend including El Salvador’s Bitcoin adoption and the swirling news about the Bitcoin ETFs.

BTC whales are an integral part of the ecosystem but some whales might be sinking towards extinction given the data gleaned from Glassnode. The data revealed that larger addresses are reducing their holdings while lesser whales are accumulating the asset.

Two Whales, Two Different Stories

Colin Wu, a Chinese crypto-journalist made a telling observation regarding the patterns of Bitcoin whales in recent weeks. His tweet reads, “According to Glassnode, the number of addresses with current holdings of ≥ 10,000 Bitcoins has dropped to the lowest in history, with only 82 Bitcoin addresses holding ≥ 100 Bitcoins.” 

This statistic is grim for whales and has left several enthusiasts scratching their heads as Bitcoin has several positives going for it at the moment. There is the idea that the reduction in the number of large whales for the asset might be seen as just one more step towards decentralization. Yet, there remains a catch. Bitcoin “whales may not be having all of their holdings in a single address and moving crypto for risk management purposes,” according to Simon Peters, a market analyst at eToro. This rebuts the argument of decentralization for the network if that is the case.

While the data might be gloomy for whales, smaller whales with 100 – 1,000 BTC have been on a steady ascent according to data obtained from Santiment. This is a bullish metric as there has been accumulation by this class of whales in the last five weeks. The continuation of this trend might see some of these small whales make the transition to becoming behemoths.

Why Are Smaller Whales Stacking Up?

Several factors are responsible for the patterns of whale behavior in recent weeks. Without a doubt, the El Salvador incident played a role as it marked a watershed moment for the network with a country elevating it to the status of legal tender. It whipped up optimism amongst investors that were buoyed by speculation that Tonga and Brazil could follow El Salvador’s path.

After Bitcoin’s historical poor run of form, perhaps, investors were confident in the cyclical nature of the asset that October would be a bullish one. There is also speculation that a Bitcoin ETF was on the horizon which has led to a significant spike in the price of the asset. A recent Goldman Sachs survey revealed that 15% of family offices that manage the wealth of the ultra-rich are already adding cryptocurrencies to their portfolios as a hedge against inflation amongst other reasons.

In the last week, Bitcoin has made double-digit gains to trade at $65K while daily trading volume is at $40 billion. 

Original source: ZyCrypto