There has been an unprecedented surge in Bitcoin (BTC) whale activity, exceeding the exchanges’ inflows as of June 2022. Recent data explains the nature of this year’s Bitcoin whale transactions.
Data indicate that most of these whales’ buying and selling activities show that they are speculative investors.
Opportunistic Traders Driving Whale Activities
The latest crypto market report by Glassnode, a renowned analytics firm, has challenged the common perceptions about BTC whales’ transactions.
In the latest issue of its weekly newsletter, “The Week On-Chain,” Glassnode states that the most active whales in the crypto market are entities trying to exploit the market’s current situation to make huge profits rather than long-term investors or institutional investors. Glassnode’s latest discovery sheds new light on the behavior of major players in the cryptocurrency market and provides fascinating insights into their motivations and actions.
According to the famous analytics firm’s latest findings, there has been a significant increase in short-term holders. The report suggests that these types of investors are becoming more common, as evidenced by their practice of holding Bitcoin for a maximum of 155 days.
The shift in this trader demographic has attracted market analysts’ interest, prompting them to investigate the underlying causes of this phenomenon. According to the Glassnode report, short-term BTC inflows on exchanges have risen to 82%.
However, this rate of inflows is higher than the average of the previous five years, which has generally ranged between 55% and 65%. The report added that there was a clear preference for short-term trading on the BTC/USD pair before May 2023.
But, the FTX crash in late 2022 was a pivotal event that intensified speculators’ desire to profit from the market’s volatility regardless of its long-term direction. Unsurprisingly, these short-term investors have had varying and intriguing results.
Their realized profits and losses have closely mirrored the volatile price actions of digital assets.
Whales Ramp Up Exchange Activities In July
Nevertheless, whales’ BTC transactions on exchanges have soared massively in recent months. Earlier this month, they accounted for 41% of total inflows on these crypto platforms. This surge in whales’ trading activities has attracted the interest of market analysts, who are closely monitoring the implications of these increased cryptocurrency transactions.
Meanwhile, Glassnode posits that the actions of these large-volume investors will be closely scrutinized for any impact on overall market sentiment and price trends as the market dynamics evolve.
The Week On-Chain” also offered valuable insights on the whales’ impact in balancing the market’s supply and demand. Nevertheless, other factors besides whales’ activities influence BTC and crypto price actions.
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