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Bitcoin Whales Keep Accumulating BTC Even After Breaking Through $50,000

February 18, 2021 at 14:26 by Mark Stevenson

According to the latest data, the number of addresses of whales holding Bitcoin (BTC) reached a record high. This can be seen as a bullish sign, as BTC prices are above $50,000 and show sustainability.

The increasing number of whales is an indication that too many investors are actively accumulating Bitcoin as the bullish trend continues.

BTC addresses holding $1m Bitcoin. Source: Glassnode

The increase in Bitcoin whales is important

Bitcoin prices are at risk of severe selling pressure if whales start selling in large positions or take profits during a bullish cycle. When this happens, the over-leveraged futures market will begin to fall, causing liquidation and major adjustments.

However, continued whale accumulation, as shown by on-chain data, will strengthen the foundation of the ascending rally.

Currently, 94,000 BTC addresses hold over $1 million in Bitcoin, according to analysts at Glassnode.

Meanwhile, a similar trend has been discovered by researchers at Whalemap, an on-chain analysis firm that tracks Bitcoin whale activity.

The researchers said that in previous bull cycles, the number of addresses holding between 1,000 and 10,000 BTC decreased. However, the number of Bitcoin whales has increased significantly in this bullish cycle.

Bitcoin whale inflows. Source: Whalemap

What are the short-term risks?

In the meantime, Bitcoin has several factors that confirm the continuation of the ongoing bullish rally. Purchased by whales, trading volumes are generally increasing, and institutional investors are also becoming more interested.

However, there are significant risks to the market. It’s an overly leveraged futures market. Bitcoin and Ethereum futures markets have raised more than 0.15% as of February 18.

Normally, the funding rate for cryptocurrencies is 0.01%. When the funding rate soars, it means that most of the market is buying.

This problem, however, occurs when a small fall occurs in Bitcoin or Ethereum. Due to the high leverage of the market, it can fall sharply, often leading to sharp adjustments. However, adjustments are likely to occur in the short term due to the high funding rate.

Given that the cryptocurrency market often sees corrections during the weekend, a pullback in the next few days remains likely despite the bullish market structure of BTC and ETH.

If you have any questions and comments on Bitcoin today, use the form below to reply.

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