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Crypto Sources have reported that new Bitcoin Whales that entered the market this year have poured nearly $108 billion into the space. Data gathered from CryptoQuant as of October 6 brings this to light. These new entrants have increased their share by a whooping 13X, going beyond how it has been in recent times, forming nearly 48.8% of Bitcoin’s total realized cap. This brings them really close to the well-known, larger whales with $113 billion invested.
One of the most significant metrics, as outlined above, has been the realized cap. This measures the value locked up in Bitcoin by looking at each unspent transaction output (UTXO) and evaluating its price per its last transaction. The addition of these new Bitcoin Whales to the space has brought about rapid growth in investments, making it the highest contribution from this group in the history of Bitcoin.
A Generational Shift in Bitcoin Holdings
The new entrants reached an all-time-high in their share of the total realized cap hitting well above the previous 18.2% as at 16th of May, 2024. Reports say that this new ATH was realized on the 6th of October.
CryptoQuant CEO Ki Young Ju called this an influx representing a “generational shift” of ownership in Bitcoin. He thinks that the realized cap for these new whales will soon overtake that of older, long-standing whales.
It is worth noting that Bitcoin whales generally refer to wallets that hold more than 1,000 BTC, of which the average time with the funds in ownership is just under 155 days. The addresses from centralized exchanges and miners are excluded from these wallets. This is to draw emphasis on the impact of newer, independent investors driving the market.
On-Chain Data & Market Sentiment
The surge in whale activity aside, Bitcoin on-chain data has also been seeing optimistic developments. The development on the network saw a revival of its fortunes as active addresses in the network (which has been on the downtrend for 11 months), also surged, indicating increased interest and organic growth. The trend itself was highlighted by chief crypto analyst at Real Vision Jamie Coutts who took to his social media to share about the news with emphasis on the use of the network as a global unit of monetary system.
Nonetheless, Coutts pointed out that active address growth has been an inconsistent predictor over the last four years despite their strong recent performance. And although encouraging, one must consider another key metric in conjunction with these signs to really get a sense of where the market is heading.
This is what Coutts had to say; “While I anticipate #Bitcoin reaching 2-2.5x its ATH this cycle, a corresponding breakout in base chain active addresses would undoubtedly validate the network valuation. After all, Bitcoin is a global monetary network; demonstrating organic network growth and adoption across all metrics helps underwrite its future.”
Separation of Short-Term Market Dynamics and Long Term View
Reports obtained on the 8th of October from Glassnode also shed light on the market sentiment of short-term Bitcoin holders, which showed a supply-to-profit ratio of 1.2. According to the firm, which cited on-chain data and trading volume trends, short-term holders that represent new market demand will be key drivers in Bitcoin’s price movement over the coming weeks. These new Bitcoin Whales could be the potential market forces looking to shift the market in the coming months.
In the meantime, the future’s open interest is up, leaving ample room for speculation on Bitcoin prices. Even in a deleveraging scenario or market liquidation, macroeconomic uncertainties prompt the market to become more fragile and prone to intense volatility from leverage-driven trades.
Conclusion
A market transformation is occurring, with fresh Bitcoin Whales making large inflows while on-chain data calls attention to a jump in usage. New capital entering from these groups of investors is changing the game in terms of the structure of Bitcoin ownership. In the long run, this might have far-reaching implications for the future path of cryptocurrency.
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