The number of bitcoins stored in wallets holding over 1000 BTC has surged by approximately 76,000 BTC, reaching a total of nearly 7.8 million BTC. Apparently, these whales foreseeing a future surge in Bitcoin prices and stocking up at a discount to secure profits. According to IntoTheBlock, while Bitcoin ETFs saw a net inflow of $820 million, Bitcoin whales casually boosted their assets by around $3 billion.
The Role of Bitcoin Whales in the Market
In the cryptocurrency ecosystem, “whales” refer to individuals or entities holding more than 1000 BTC. These players often wield the power to influence market trends, thanks to the size of their crypto wealth. Historically, the maneuvers of these crypto leviathans have been the subject of keen observation and wild speculations because their investment decisions can lead to market movements of epic proportions.
Whales Went Bargain Hunting for Bitcoin
The main cryptocurrency started the month on a high note, soaring to a peak above $48,900 on January 11, coinciding with the debut of spot exchange-traded funds (ETFs) in the US. However, prices faced serious pressure, falling to a low of around $38,500, as investors in the crypto investment fund Grayscale Bitcoin Trust (GBTC) decided it was time to take profits. In the aftermath of this pullback, some savvy whales seized the opportunity to buy coins at a discount through the Bitfinex crypto exchange.
According to TradingView data, over the weekend, Bitcoin was trading on Bitfinex with a $100 premium, which is significantly higher than other exchanges like Coinbase and Binance.
“Someone on Bitfinex has been non-stop buying TWAP in BTC for the past 3 days straight, hence the grand premium at Bitfinex. By my calculations, about $50 million has been accumulated so far,” said the market analyst and trader under the nickname Byzantine General.
TWAP, or Time-Weighted Average Price, is an algorithmic strategy. It splits up those massive orders over time, helping traders minimize slippage when buying or selling large orders. And what’s slippage, you ask? It’s the gap between the execution price of a trade order and the price it was requested.
So-called TWAP shopping continued, as sales from the bankrupt FTX estate and outflow from the Grayscale Bitcoin Trust (GBTC) sent prices below $39,000 for the first time since the early days of December.
The blue line represents the moves of the whales and the black line, the cryptocurrency prices. In a sign of confidence in the long-term prospects of the crypto, the whales have increased their reserves as prices have fallen.
Some observers and investment banks, including Standard Chartered, predict that the newly launched ETFs will attract billions in investments, causing the Bitcoin market price to $100,000 by the end of 2024.