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Bitcoin on-chain data hints at institutions 'deploying capital' at expense of 'hodlers'

The Cointelegraph ​

Cryptocoins News / The Cointelegraph ​ 253 Views

“Sophisticated passive buying” on Bitcoin (BTC) spot exchanges coincides with the trend of BTC leaving exchanges to cold storage.

Adjusted Bitcoin supply shock. Source: Willy Woo

The price recovery witnessed in the Bitcoin market across the last two weeks has coincided with a rise in hodlers and speculative investors selling their coins, according to data provided by researcher Willy Woo.

Nonetheless, BTC’s price ability to withstand the selling pressure meant there was buying pressure coming from elsewhere. As Cointelegraph reported earlier this week, so-called Bitcoin whales are accumulating BTC at current price levels.

“This selling is contrasted by exchange data showing sophisticated passive buying on spot exchanges and movement of coins to whale-controlled wallets,” wrote Woo, adding:

“This view is supported by coins moving away from exchanges to cold storage. Meanwhile, whales who hold more than 1,000 BTC ($45m) are accumulating. This hints at institutional money deploying capital.”
Bitcoin exchange net flows and deposits to/from whale wallets. Source: TradingView

Despite the price of Bitcoin retreating going into the weekend, the rise in whale addresses controlling 1,000–10,000 BTC has also not gone unnoticed by on-chain data resource Ecoinometrics.

Hunain Naseer, a researcher at OKX, said Bitcoin would need more time to consolidate ahead, given its recent rejections and deviation from its 20-day moving average, as shown in the chart below. Nonetheless, reclaiming $46,000 would likely have BTC’s price test $50,000 next.

BTC/USD daily price chart, with blue arrows marking recent Fridays. Source: OKX/TradingView

On the other hand, Woo called $33,000 a solid bottom for Bitcoin, given the recent selling sentiment among hodlers and speculative investors. As Cointelegraph reported, $40,000 remains a key level to hold, while $46,000–$48,000 remains a heavy resistance area for the bulls. 

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.


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