Large investors in the cryptocurrency market, known as crypto whales, have been busy accumulating Bitcoin (BTC) this month, amassing a total of $3 billion worth of the leading cryptocurrency.
According to data from onchain analytics firm IntoTheBlock, the amount of Bitcoin held in whale wallets has increased by approximately 76,000 BTC, bringing the total holdings of these whales to nearly 7.8 million BTC.
It’s important to note that the definition of “whales” includes any entity, individual, or fund holding over 1,000 BTC, which also encompasses the ETFs.
Whales Exploit Bitcoin Dip to Accumulate More
Bitcoin started the month on a positive note, reaching highs above $48,900 on January 11 following the launch of U.S.-based spot exchange-traded funds (ETFs).
However, prices faced downward pressure and dipped to lows near $38,500 last week as investors in the Grayscale Bitcoin Trust (GBTC), a popular crypto investment vehicle, decided to take profits.
Seizing the opportunity, some whales took advantage of the lower valuations and acquired more Bitcoin through the Bitfinex cryptocurrency exchange.
“While bitcoin ETFs have seen net inflows of $820 million, Bitcoin whales have seen an increase of approximately $3 billion (76,000 BTC) so far in 2024,” IntoTheBlock said in its weekly newsletter.
Bitcoin whales have increased their $BTC holdings by ~$3B (76,000 BTC) sine the start of this year. pic.twitter.com/0hi3Q7WXEo
— IntoTheBlock (@intotheblock) January 27, 2024
The graph provided by IntoTheBlock shows a blue line representing whale activity, while the black line represents the price of Bitcoin.
This data indicates that despite the price fluctuations, whales have shown confidence in the long-term prospects of the cryptocurrency and have continued to accumulate more bitcoin during the dips.
Various observers and investment banks, such as Standard Chartered, have expressed optimism regarding the recently launched bitcoin ETFs, predicting that they will attract billions of dollars in investments and drive the market price of the cryptocurrency to reach $100,000 by the end of 2024.
Crypto Whale Impact on the Market to Diminish After Spot ETFs
Aurelie Barthere, Principal Research Analyst at Nansen, believes the approval of spot Bitcoin ETFs will specifically impact crypto whales, who control a large share of the current token supply and wield unmatched influence in spot markets.
“We know that crypto token ownership is very skewed, with ‘whale’ wallets owning a large share of the token supply,” Barthere said in a recent interview with Cryptonews.com.
“Any change in that structure would probably reduce price volatility in the long term, intuitively.”
She also opined that the arrival of ETFs will bring more liquidity to the spot markets, which could lead to a more stable market.
Regarding the short-term performance of these ETFs, Barthere expects lower-fee ETFs to attract more inflows.
The competitive landscape among Bitcoin spot ETF providers, according to Barthere, will be shaped by factors like reputation, size, existing footprint, and management fees.
JPMorgan analysts have also predicted that the success of these newly created ETFs will hinge on fees and liquidity.
Given the high 1.5% fees associated with GBTC, they expect significant outflows from this Bitcoin trust.
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