On September 19, as the price of Bitcoin (BTC) exceeded $11,100, whale activity and Bakkt’s all-time high volume indicated an increase in momentum.
According to Ki Young Ju of CryptoQuant, the amount of bitcoin sent by whales to exchanges has decreased. Historically, this data shows that the selling pressure from high-net-worth Bitcoin holders is small.
At the same time, Bakkt’s institutional-centric Bitcoin futures market has hit a record high daily trading volume. Bakkt is operated by ICE, the parent company of the New York Stock Exchange (NYSE), to provide institutions with Bitcoin trading convenience.
Bitcoin whale activity and Bakkt’s record trading volume indicate that both whales and institutions may be hoarding BTC.
Market data shows an optimistic trend, Bitcoin continues to test $11,000
Due to the large scale of transactions between whales and institutions, they have a huge impact on the price of Bitcoin.
A whale that sold bitcoin for more than $12,000 after holding it for two years owns approximately 9,000 BTC. Calculated based on the current market price of Bitcoin of $11,070, which is close to $100 million.
Considering that the risk of large sell orders is reduced, the decline in demand for whales to sell BTC is a positive factor. Ki said:
“The exchange’s whale ratio hit a new annual low. The fewer whales are transferred to the exchange, the less sell-offs and the higher the price of BTC.”
The data that CryptoQuant refers to is a large amount of Bitcoin reserves held by whales in the exchange. As Cointelegraph previously reported, some whales are sold at current prices. But data shows that most whales are unwilling to sell for $11,000.
The whale’s optimism coincided with the apparent increase in the demand for Bitcoin from institutions on Bakkt.
According to data from Arcane Research and Skew, Bakkt’s daily trading volume hit a record high on September 15, most of which were settled in kind. And just 24 hours ago, MicroStrategy bought another $175 million worth of BTC.
The timing of the surge in Bakkt’s Bitcoin futures market is worth noting because it follows MicroStrategy’s bulk purchases.
The historical volume of Bakkt Bitcoin Futures.Source:SkewBakkt Bitcoin Futures. Source: Skew
Based on these data, it can be concluded that some institutions may buy BTC after MicroStrategy’s high-profile investment, especially when some popular pricing models show that Bitcoin’s current valuation is low. An analyst from Arcane Research wrote:
“Another day, Bakkt hit a record high and showed an upward trend. After the trading volume hit a new high on Tuesday, yesterday this institution-centric Bitcoin futures platform had even higher trading volume.”
Four days ago, Bakkt’s trading volume hit a record, the trading activity of whales on the exchange declined, and BTC rose from 10,800 US dollars to 11,100 US dollars.
What is the next goal in the short term?
Some traders said that on the basis of the hoarding of institutional investors and whales, there may be a rebound after profit-taking.
In recent months, the decentralized finance (DeFi) market has performed better than mainstream cryptocurrencies such as BTC and Ethereum (ETH). With the strong performance of DeFi tokens, investors may cyclically invest profits in BTC and stablecoins.
The anonymous trader “Light” said:
“I sold all ETH and altcoins last week and converted them into BTC and fiat currencies. Almost everyone has insufficient exposure to Bitcoin, and DeFi exposure is too large. When everyone is standing On one side.”
If the trend continues, DeFi tokens may underperform BTC in the short term. At least for the foreseeable future, this may strengthen the growth trend of BTC, whose dominance index has fallen to an annual low in recent months.
