Whales were serious about buying the dip, accumulating more Bitcoin (BTC) in July. Large-scale wallet growth marked a spike not seen since 2014.
Bitcoin (BTC) is changing its ownership structure, adding more whale wallets. In July, the total purchases coming from known whales reached $5B, causing a monthly spike not seen since the earlier days of BTC.
Whale holdings increased both in terms of raw wallet count and in coins held privately. The buying is in addition to BTC held in custody for ETF and other types of collateral.
The current wave of accumulation comes from all wallet sizes and ages, but especially from wallets with more than 10K BTC. The latest on-chain developments for BTC give off mostly bullish signals. The recent months also coincided with the accumulation and buying range based on the Rainbow Chart model. Accumulation continued as BTC did not print new records after its halving. Despite this, the rates of accumulation accelerated in Q3, entering a parabolic trend as whales proved hungry for spot-buying BTC.
The BTC market cap dominance also expanded to 56.4%, the highest in three years. The BTC narrative remained dominant, despite a growing selection of altcoins and tokens. BTC replaced the Ethereum (ETH) and altcoin rally narratives, offering more stability and a more consolidated market.
In the short term, however, BTC is still prone to fluctuations and a shift in sentiment. After a weekend with little selling pressure, BTC entered the new week with a slide to the $58,000 range. The price weakened despite the inflow of new USDT since the crash of August 5. The USDT supply expanded to 115.6B, which is usually a factor toward supporting higher price levels.
🚨 BREAKING 🚨
LARGE HOLDERS ACCUMULATED 84,000 BITCOIN WORTH $5 BILLION IN JULY.
THIS IS THE HIGHEST MONTHLY ACCUMULATION SINCE 2014.
GIGA BULLISH 🔥 pic.twitter.com/D64Ai9Zmuo
— Ash Crypto (@Ashcryptoreal) August 10, 2024
Whale activity shifts BTC ownership
The recent whale activity was turbulent and did not result from outright accumulation. In the past quarter, several old cohorts moved coins and realized gains, especially the buyers that were in the money during the 2024 bull market. Around 82% of all BTC holders are in the money, which allows more than 70% of buyers to hold beyond 12 months.
Additionally, buyers appeared in August, after the deep correction under $50,000 per BTC. The buying from the past few weeks also coincided with moving the newly acquired coins to secure addresses suitable for permanent holding. The accumulation is seen as an indicator of eventual institutional demand or other requirements for liquidity reserves.
The recent accumulation comes ahead of several macro factors in the world economy. Geopolitical tensions add to the pressure to accumulate BTC. The leading coin is now among the top 10 most valuable assets in the world, lining up with large-scale corporations. BTC also had multiple days with more than 700K daily transactions in July, showing it was not only a store of value but a widely used network.
Accumulation trend by whales continue in August
BTC continues a shift to external holdings, as more than $105M flowed out of exchanges in the past week. Exchange flows measure the accumulation of crypto insiders, as most ETF use the same custodial wallets provided by Coinbase.
There is also demand for miner funds, as buyers continue to absorb newly produced coins. In July, miner reserves remained relatively low. In August, buyers absorbed around 65K BTC from miner reserves, taking them to the lowest level in five years. Miners have been selling rewards habitually, though overall capitulation has not happened as predicted. After the halving, the market will only have access to 450 new BTC daily with no trading history or unverified origins.
The accumulation trend continued during last week’s drop, with some whales acquiring thousands of tokens. One of those whales was the ‘Mr. 100’ address that has been closely watched for signs of recovery. The whale address has been identified as the Upbit exchange cold wallet, which now holds more than 67K BTC. The wallet actually had net outflows in June, acquiring coins only after price crashes.
Another big shift happening in the past month was the movement of BTC out of Grayscale’s GBTC fund. Grayscale turned into a net seller with 268K BTC, while BlackRock’s IBIT fund increased its holdings to 347K BTC.
Cryptopolitan reporting by Hristina Vasileva
