Bitcoin Mega Whales move opposite to the rest of the market: Glassnode

[ad_1]

On-chain data from Glassnode shows that the largest Bitcoin whales showed the opposite behavior to what other investors did.

The Bitcoin market is currently observing a moderate distribution phase

According to data from on-chain analytics firm Glassnode, the behavior of top BTC whales has once again deviated from the rest of the market. The relevant indicator here is the trend accumulation score, which tells us whether Bitcoin investors are buying or selling.

The metric mainly takes into account two factors to find this score: the balance changes that occur in the wallets of the holders and the size of the investors who make these changes. This means that the larger the investor making a buy or sell move, the greater their weighting in the trend accumulation score.

When the value of this metric is close to 1, it means that the biggest holders in the sector are accumulating right now (or that a large number of small investors are exhibiting this behavior). On the other hand, the indicator has a value close to zero, which suggests that investors are currently showing a distribution trend.

This indicator is usually defined for the whole market but can also be used on specific investor segments. In the chart below, Glassnode has displayed the Bitcoin trend accumulation score data of the different market holder groups.

The metric value appears to be red for most of the market right now | Source: Glassnode on Twitter

Here, market investors have been divided into six different cohorts based on the amount of BTC they carry in their wallet: less than 1 BTC, 1 to 10 BTC, 10 to 100 BTC, 100 to 1,000 BTC, 1 000 to 10,000 BTC, and above 10,000 BTC.

From the chart above, it is visible that the trend accumulation score for all of these bands had a value of around 1 at the bear market low after the FTX crash of November 2022, suggesting that the market as a whole was involved in big buying at the time.

This accumulation continued until the rally arrived in January 2023, when market behavior began to change. Holders began distributing during this period, selling particularly strongly between February and March. Following this strong distribution, the rally ran out of steam and the price dipped below $20,000.

However, these investors started accumulating again when the price rallied strongly and the rally resumed. However, this time the buildup was only moderate.

Interestingly, while market behavior had been more or less uniform in the months leading up to this new accumulation sequence (meaning all groups had bought or sold at the same time), this new accumulation sequence n didn’t have the largest of the whales (group over 10,000 BTC) participating. Instead, these huge investors were going through a distribution phase.

Ever since Bitcoin broke above the $30,000 level in mid-April 2023, investors have been selling again, showing moderate distribution behavior.

Like the accumulation phase preceding this sale, the 10,000 BTC whales above did not join the rest of the market; instead, they aggressively accumulated and expanded their portfolios. These holders seem to have decided to go in the opposite direction of the general market.

BTC price

As of this writing, Bitcoin is trading around $28,900, up 1% in the past week.

BTC once again fell below $29,000 | Source: BTCUSD on TradingView

Featured image by Rmi Boudousqui on Unsplash.com, charts by TradingView.com, Glassnode.com

[ad_2]