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Are whales accumulating Bitcoin between $30K and $40K?

Are whales accumulating Bitcoin between $30K and $40K?
Image by Pexels from Pixabay

Key Takeaways

  • Whales appear to be accumulating Bitcoin following the recent price dip
  • Not all data aggregators agree there is a negative exchange Netflow in the past week
  • Bitcoin price momentum remains uncertain as the market is still volatile

Belgium (CoinChapter.com) — As the Bitcoin price decided to take another nosedive, many people have different opinions on the current market proceedings. Whereas some claim there will be no institutional demand at current values, some metrics paint a different picture. It is possible whales are accumulating heavily, although there will always be room for interpretation of the data.

Also read: Bitcoin’s plunge to $20K won’t come as a surprise, asserts top executive

Whales And Negative BTC Netflow

Anyone can find a sign of whether whales are accumulating Bitcoin in the exchange net flows.

If less money is being sent to exchange and more withdrawals occur, there is a good chance some accumulation is taking place. In addition, after the recent Bitcoin price dip, there is an extra incentive for long-term speculators and traders to pick up BTC at lower prices. Compared to its all-time high, Bitcoin was down by over 50% for a short period yesterday before bouncing back rather strongly.

Whales, Are whales accumulating Bitcoin between $30K and $40K?
BTC/USD Chart by Tradingview.com

Analyzing the current and recent exchange net flows paints a somewhat interesting picture.

The data by CryptoQuant seems to confirm that whales have accumulated BTC during every price dip over the past week. Thus, lower prices create a “trigger” for many people who have fundamental long-term faith in the world’s leading cryptocurrency. Additionally, many users dollar-cost average during these dips to balance their portfolio’s cost/profit ratio.

BTC All Exchange Netflow. Source: CryptoQuant
BTC All Exchange Netflow. Source: CryptoQuant

Strengthening the belief of whales accumulating Bitcoin is a metric by Glassnode. The HODLer Net Position Change depicts whether holders are selling (negative change) or accumulating (positive change). As this metric is now at an eight-month high, it is obvious some users have been accumulating in recent months. That trend began in early 2021 and, despite flattening out a bit, is still going strong this week. 

Bitcoin HODLer net position change. Source: Glassnode
Bitcoin HODLer net position change. Source: Glassnode

When multiple information providers hint at a certain development, it is always worthwhile to seek additional data sources. Unfortunately, nothing is ever cut-and-dried in the cryptocurrency space, as there is a tremendous amount of data to sift through. Gaining a better understanding of this industry is essential for both novice and experienced users alike.

Conflicting Data Creates Confusion

Although the data by CryptoQuant and Glassnode shows there are significant netflow deficits in recent weeks, the data by Viewbase doesn’t necessarily agree. 

In the past seven days, there has been a positive net flow of 12,318 BTC. Having more Bitcoin on exchanges than before seems to oppose the theory of whales accumulating BTC. Although there is an outflow of funds from Huobi, Poloniex, and OKEx, there are strong influxes for Bitfinex, Kraken, and Binance. More liquidity can trigger additional volatility, which can swing in either direction where Bitcoin is concerned.

Supply on exchange wallets. Source: Viewbase
Supply on exchange wallets. Source: Viewbase

Interestingly, Glassnode has some conflicting data as well. The number of addresses receiving from exchanges is at a seven-month low. That doesn’t automatically invalidate the idea of whales accumulating Bitcoin, although it is in line with the statistics provided by Viewbase. That makes one wonder where CryptoQuant’s negative net flows originate from.

Not every data provider tracks the same APIs for information, though, resulting in discrepancies along the way.

Bitcoin number of address receiving from exchanges. Source: Glassnode
Bitcoin number of address receiving from exchanges. Source: Glassnode

Based on the current information across the different data providers, it remains unclear whether whales accumulate Bitcoin at the current price range. Logically speaking, they will be, as these values are too good to pass up on. An asset that was valued at over $60,000 not that long ago is a steal at anything below $40,000, at least in theory. 

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JP Buntinx_CoinChapter
Jean-Pierre Buntinx

JP Buntinx has been writing about cryptocurrency since 2012. His interest in crypto, blockchain, fintech, and finance allows him to cover a broad range of different topics.

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