Bitcoin Whales Drain Coins at Highs – OKEx Study


  • Bitcoin hodlers sold their coin supply they had stored for years

  • Institutional Investors Buy Hodler Coins at Record Price

  • There is a similar trend in the Ethereum network, so investors expect a record rise in the price of the token

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Studies by cryptocurrency exchange OKEx and analytical company Catallact prove that bitcoin hodlers sold coins en masse as soon as the price reached $ 20 thousand.

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Hodlers were selling, and institutions were buying

At the beginning of 2021, bitcoin reached a record price, stepping over the $ 40 thousand mark. In many respects, the growth in the value of the main cryptocurrency was influenced by the activity of institutional investors, who actively bought bitcoin and other cryptocurrencies in order to hedge currency risks.

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The main sellers of bitcoin were large cryptocurrency exchanges and bitcoin hodlers, which accumulated coins for a long time in the hope of a rise in prices. This is evidenced by the results of a study by the Catallact analytical company and the OKEx cryptocurrency exchange.

Analysts have traced a clear relationship between the number of large transactions with bitcoins (from 1000 BTC), which were stored for a long time in users’ wallets, and the growth of the asset value.

Data from Catallact and OKEx Research

Based on the findings, analysts made three key findings:

  1. Long-term holders of BTC, also referred to as “whales”, sold bitcoins when the price reached record highs;
  2. The stocks of bitcoins in the accounts of long-term holders began to decline as the value of BTC increased
  3. Institutional investors entered the market, so bitcoins flowed from long-term holders to institutional investors’ wallets.

Analysts also note that the growth in the number of transactions coincided with the announcement of investor and billionaire Paul Tudor Jones about investing part of his assets in bitcoin. Many institutional investors listened to Jones’ opinion and started buying cryptocurrency. In the period from October to December 2020, several large investors, such as Microstrategy, Square, Grayscale, acquired bitcoins worth billions of dollars at once.

Institutional investor activity is supported by research from Catallact and OKEx. Analysts recorded several key points of growth in the number of transactions, which occurred in August-September 2020 and reached record levels in October-December last year. The most active transactions grew in the USA, Europe and Asia.

Bitcoin Whales Drain Coins at Highs - OKEx Study

The volume of bitcoin production per day by region. Data from Catallact and OKEx Research

Investors will switch to Ethereum

Despite the popularity of Bitcoin among institutional investors, a token may come to the fore in 2021. As the use of cryptocurrencies grows, new types of tokens appear. They can represent value or something intangible like voices. Two … More ETH. Messari analyst Ryan Watkins has already predicted that institutional investors’ attention will shift from Bitcoin to Ethereum.

“Forecast for 2021: in 2021, institutions will start investing in $ ETH. If you have already recognized bitcoin as a valuable asset, it is easier for you to take the next step and switch from $ BTC to $ ETH “- said Watkins.

In mid-January, Messari analysts recorded a sharp surge in transactions on the Ethereum network. A similar phenomenon was described in their study of bitcoin OKEx and Catallact. It is likely that the ETH rate will follow the path of the MTC and reach record levels.

Michael Novogratz, a renowned hedge fund manager and early bitcoin investor, already predicted that ETH / USD would jump to $ 2,600 soon. The main reason for the growth of the token will be the full deployment of the staking function on the Ethereum protocol, which will lead to a long freeze of a large number of coins. Such a reduction in ETH in circulation will be the same impetus for price growth as halving for Bitcoin.

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Bitcoin Whales Drain Coins at Highs - OKEx Study
Bitcoin Whales Drain Coins at Highs - OKEx Study
Bitcoin Whales Drain Coins at Highs - OKEx Study
Bitcoin Whales Drain Coins at Highs - OKEx Study

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