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Retail investors are in no rush to invest in bitcoins
Investors expect bitcoin’s value to rise in the near future
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The latest research of the OKEX cryptocurrency exchange together with the analytical company Catallact proves that large investors are actively accumulating bitcoins in anticipation of a price increase.
Institutions prefer to invest in bitcoin
Since the beginning of 2013, the number of institutional investors who are investing in bitcoin futures has steadily increased. A study of the OKEX cryptoexchange and Catallact revealed a certain pattern – the number of institutional investments increases sharply immediately after the statements of large funds about investing in cryptocurrency.
In May 2020, renowned macro investor Paul Tudor Jones announced that his fund would invest in BTC futures to protect assets from inflation. Immediately after Jones’ speech, the media reported that Nasdaq-registered business analytics company MicroStrategy acquired 21,454 BTC worth more than $ 250 million to protect its coffers from fiat inflation..
This caused a surge in institutional investment in the market. Catallact cites statistics that in June-August 2020, the number of large transactions in MTC, from 5,000 to 10,000 BTC, increased.
Since the analytical company cannot give an unambiguous answer about the origin of transactions, experts put forward two possible theories:
“It is possible that one or more cryptocurrency exchanges that hold an extremely large amount of BTC have been shuffling coins into various wallets for a variety of reasons, most likely security related. There is also the possibility that large institutional players and big money whales accumulated or distributed large amounts of BTC during this consolidation period in anticipation of the price of the leading cryptocurrency going up or down, ”the study said..
If we talk about the activity of bitcoin whales, then the largest number of large transactions was recorded in March, after the market collapse, as well as in June-July. This confirms the theory that the whales bought bitcoins at the time of the price drop, expecting it to rise in the future..
Earlier, BeInCrypto reported that interest in Bitcoin futures on the Chicago Mercantile Exchange (CME) continues to grow, signaling further attraction of institutional investors, who until recently bypassed this asset due to increased volatility and other risks..
Retail investors are in no rush to invest in bitcoin
Unlike bitcoin whales, retail investors are slow to invest large amounts in cryptocurrencies. The number of daily transactions less than 0.1 BTC is correlated with the movement of the digital currency price. This suggests that retail investors are buying and selling relatively small amounts of BTC as the price of the cryptocurrency fluctuates..
If we talk about medium-sized transactions (from 10 to 100 BTC), then there is a different trend..
“When we look at the number of transactions from 10 to 100 BTC per day, we see two things to watch out for: the average number of transactions dropped immediately after the March COVID-related market crash and remained lower than what preceded it. However, since the end of June there has been an upward trend in the number of average transactions per day, ”the study says.
The March crash is believed to have shocked some of the major retail players, while the transaction activity of bitcoin miners declined after the halving. However, the number of deals of this size has been growing steadily since the end of June..
Bitcoin Whales Using 2020 to Accumulate BTC Research
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