Bitcoin Whales Increase Holdings by Only 1% Monthly

Recent trends show that large investors in Bitcoin have drastically reduced their accumulation rate compared to earlier this year, prior to achieving all-time highs.

According to recent research, Bitcoin currently requires increased demand to reach new all-time highs, as the accumulation by whales has significantly slowed.

Decrease in Whale Accumulation

The demand for Bitcoin is still not robust enough to attract investments that could elevate its price to record highs.

According to data from CryptoQuant, large Bitcoin holders, often referred to as “whales,” have dramatically reduced their buying momentum since the previous all-time high in March. They have cut back their monthly holding increase from 6% in February, the highest rate since February 2019, to a mere 1% now.

“Historically, a monthly growth rate exceeding 3% in whale holdings has correlated with rising Bitcoin prices, which is not observed at present.”

In the absence of whale activity that could trigger a price spike, the performance of U.S. spot Bitcoin exchange-traded funds (ETFs) remains inconsistent.

Current daily net inflows into spot ETF products are only a small fraction of what they were back in March, with last week averaging just 1,300 BTC daily.

“Revitalizing spot ETF investments is critical to bolstering overall Bitcoin demand, which may lead to a price increase,” reports CryptoQuant.

However, “permanent holders” in the market—those who buy Bitcoin but never sell—are bucking the trend amid current market stagnation.

Unlike whales, this group has steadily increased their exposure to Bitcoin.

“Despite the slowdown in overall Bitcoin demand, permanent holders are accumulating Bitcoin at unprecedented rates,” the report indicates.

“The total balance for these holders is escalating at a record rate of 391K Bitcoin monthly, with their demand growing even faster than in Q1 2024, when Bitcoin prices surpassed $70K.”

Challenges for Bitcoin Speculators

The reluctance among more speculative investors could be attributed to recent price movements.

The slump to six-month lows in early August left many recent buyers with losses.

According to data from BGeometrics, these investors have a cost basis that remains above the current market price, hovering around $63,000.

At the latest update, BTC/USD was trading around $59,000, as reported by TradingView, which reflected a modest 2.5% drop overnight.

This analysis does not provide investment advice. All trading and investment decisions involve risk, and it is recommended that readers perform their own research.