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Bitcoin (BTC) is experiencing a new type of “reversal” once it reaches $ 20,000: the original whales continue to sell their coins to large institutional buyers.
Data from CryptoQuant’s on-chain analytics service shows that despite long-term investors rushing to sell BTC profitably, demand from buyers continues to outpace their supply.
Bitcoin’s old whales are ‘small’ compared to new buyers
With the BTC / USD pair climbing to new highs, the “original” whales start to look like plankton, while institutions line up for massive purchases.
According to data from CryptoQuant related to exchanges, exits reached yearly highs in the hours immediately before crossing the $ 20,000 threshold. The combination of a shortage of BTC on exchanges and institutional over-the-counter purchases seems to have a logical consequence growing struggle to seize the remaining BTC, increasing the price.
Danny Scott, CEO of the British exchange Coin Corner, summarized the situation like this: “I repeat … the liquidity crisis is approaching.”
CryptoQuant CEO Ki Young Ju, who said he shorted Bitcoin to $ 20,800, also said He admitted have been surprised by the activity of the whales. As the market continued to absorb big sales, Ju tweeted: “Next time I’ll focus on the bigger whales“.
“The original whales were very small.”
Ki then highlighted some “Be unable“Exits from Coinbase as evidence of institutional over-the-counter activity. Current BTC reserves held by exchanges are at their lowest levels since November 2018.
Ki posted a graphic with some of his notes, needing:
“It seems like massive Coinbase exits usually go to a new cold wallet for custody / OTC that had $ 6,000-8,000 BTC. #Greyscale uses #GenesisTrading to buy Bitcoin, and #GenesisTrading uses Coinbase Custody.”
Asset managers believe purchases will continue
As Cointelegraph reported, the size of institutional demand for BTC is growing exponentially this month. On Wednesday, hedge fund One River Asset Management confirmed that it plans to increase its holdings in Bitcoin and Ether (ETH) to more than $ 1 billion by 2021.
Bloomberg reported some statements from the CEO of the company, Eric Peters: “Be a historical allocation of resources to this new asset class“.
The flows have just begun.
The $ 1 billion target would place One River in direct competition with major major entities already in the BTC market, including Grayscale, which this week raised its total assets under management to more than $ 13 billion.
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