New data shows that Bitcoin (BTC) whale buying and selling in 2023 will mainly come from speculative investors.
In the latest weekly newsletter, “One week on the chain,” analyst firm Glassnode suggests that, contrary to popular belief, opportunistic entities are the most active whales.
The Birth of a Bitcoin ‘Short Holder’ Whale
Since BTC price action back to $30,000, there has been a shift among Bitcoin traders.
As Glassnode shows, so-called short-term holders (STH) — investors who hold tokens for up to 155 days — have become more common.
It turns out that the largest group of investors – the whales – are also made up of a large number of STHs.
“The dominance of short-term holders in exchange inflows has soared to 82% and is now well above the long-term range of the past five years (typically 55% to 65%),” the report said.
“From this, we can demonstrate that most of the recent trading activity is driven by whales active in the market in 2023 (and thus classified as STH).”
Interest in trading short-term moves in BTC/USD was evident well before May. Since the FTX crash in late 2022, speculators have become increasingly eager to take advantage of the ups and downs in volatility.
Results have been mixed – realized profits and losses often skyrocket as prices fluctuate.
Glassnode continued: “If we look at the extent of realized gains and losses from short-term holder volume flowing into exchanges, we see that these new investors are trading based on local market conditions.”
“Since the impact of the FTX event, every rally and correction has resulted in STH’s profit or loss increasing by more than 10,000 BTC respectively.”
Whales show ‘high inflow bias’ to exchanges
Recently, whale trading activity has increased, accounting for 41% of total inflows in July at one point.
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“Analysis of net whale flows on exchanges can serve as a proxy for their impact on the supply-demand balance,” A Week on Chain commented on the topic.
“Over the past five years, net whale flows to exchanges have tended to fluctuate between ±5k BTC per day. However, throughout June and July this year, whale inflows have been consistently high at 4,000 to 6,500 BTC per day.”
As Cointelegraph reported, whales are not the only force at play when it comes to BTC sales.
Mining pool Poolin grabbed headlines for its trade flows to Binance, while potential hedging profits for miners also boosted sell-side activity.
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This article does not contain investment advice or recommendations. Every investment and transaction involves risk, and readers should do their own research when making a decision.
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