Whales continue buying Bitcoin…Over the past six weeks, crypto hodlers have purchased about 170,000 digital coins. So why are investors increasing their positions, and how might this affect the quotations? Let’s try to figure out why whales are buying Bitcoin!
Who are the Bitcoin whales
Holders who own 100 to 10 thousand bitcoins (those who we call ‘whales’) continue to accumulate digital coins. It is indicated by the analytical service Santiment data. Over the past month and a half, the whales have increased their Bitcoin investments by $6,3 billion, having bought 170 thousand BTC. In the last ten days, hodlers have purchased 40 thousand digital coins.
The accumulation of bitcoins by “whales” began in mid-May of this year when the value of the leading cryptocurrency in one day fell by more than 33% and reached $30 thousand for the first time since January. At the time, the managing director of financial company BTIG, Julian Emanuel, stated that large investment funds were buying Bitcoin during the collapse of its quotations.
Maintaining a positive attitude
The accumulation of a large number of bitcoins by “whales” over the past two months may indirectly indicate that the positive sentiment remains in the long term. However, despite this, many experts recommend that you be wary of such statistics since the exact reason for whales buying Bitcoin is still unknown for now.
If, for example, a fund bought a large number of bitcoins at the maximum price, then entering long positions at the lows can lead to a “dilution” of the entry price and a downward change in the break-even exit price. In this case, investors may tend to take profits rather than hold the position for a long time.
Waiting for a new growth cycle
During the market drawdown, when many were selling cryptocurrency, large professional players, on the contrary, were stocking up on digital coins in anticipation of a new growth cycle. A good example is the investment bank Goldman Sachs that increased bitcoin trading volume despite the decline in the crypto market.
To this end, Goldman Sachs has partnered with Galaxy Digital. This is the first time that Goldman Sachs has used counterparty services to work with a cryptocurrency. Other Wall Street giants continue to grow their positions in crypto.
In July, it became known that many clients of the investment bank JPMorgan began to view Bitcoin as an asset class and want to invest in it.
Whales buying Bitcoin = good for the market
Major players continue to accumulate the cryptocurrency, but it is unknown whether these are new investors or existing holders of digital coins. New investors who have not previously participated in crypto trading may feel that buying Bitcoin 50% below its maximum price is a nice deal that is good for the market anyway.
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