- Despite the continuous price drop, bitcoin whales continue to accumulate.
- However, on-chain data indicated that most of it could accumulate to short King coin
Bitcoin is currently trading at a two-year low [BTC] Data from the series showed that whales had increased accumulation.
Read bitcoins [BTC] Price forecast 2022-2023
According to CryptoQuant analyst Dan Lim, as the BTC price suffers from the impact of a general market downturn caused by the sudden crash of cryptocurrency exchange FTX, “whales have been accumulating BTC for a long time.”
Dan Lim argued that the BTC market outlook does not look favorable in the short to medium term. Therefore, the only logical explanation for the whales’ continued accumulation was long-term HODLing. lim said,
“Although the cryptocurrency market and economic conditions are not good, from a long-term perspective, knee-down accumulation through DCA or split buying (accumulation) can be a prudent approach.”
Data from the on-chain analysis platform feelings Further confirmed this position. According to Santiment, since the FTX fiasco began, BTC has recorded a significant increase in the number of addresses ranging from 0.1 to 100 BTC.
Since November 7, the number of such addresses has increased by 9%, with more than 125,000 addresses between 0.1 and 100 BTC created since then. At the time of publication, this collection of BTC addresses totals 3.99 million.
Source: feeling
Moreover, the on-chain data showed that this class of holders has accumulated an additional +0.6% of the total bitcoin supply since November 7th.
There is a catch
While the whales may have started accumulating coins over the past week, a closer look at BTC’s on-chain performance revealed that trader sentiment has fallen into a significant negative bias.
This is due to the loss of confidence in centralized exchanges after the collapse of FTX. This has led to a sharp drop in funding rates on exchanges such as Binance, BitMEX and dYdX as investors bet on the continued decline in the price of the proprietary coin.
As of press time, funding rates on these leading exchanges are the lowest in the past six months. This may indicate that, unlike Lim’s position, whales that accumulate may do so in anticipation of a further price drop.
Source: feeling
Moreso, on the daily chart, the sellers are seen controlling the bitcoin market as the buying momentum is starting to decline.
At the time of writing, the major indices of the leading cryptocurrency are below their neutral scores. For example, the Relative Strength Index (RSI) for BTC was 37, while the Money Flow Index (MFI) was 39.
In addition, Chaikin Money Flow registered a negative value of -0.12, which also indicates that the buying pressure has eased despite the increase in options accumulation over the past few days.
Source: TradingView