The activities of the highest Bitcoin holding accounts are always in focus given they have the power to influence the market movement. Any massive selling or buying of the tokens would impact the market as the other smaller accounts tend to mirror the whales.
Even though the Bitcoin value has been fluctuating through the year, the whales buying into the token have never dwindled. Reports had earlier emerged of how whales had been purchasing Bitcoin from central exchanges. This seemed unusual given such a move tends to lead to Bitcoin price fluctuations.
The whales however seem to be keeping to known market cycles. According to the Exchange Net Position Change Indicator, there is a given market cycle through the years whales have been following. Massive outflows into the market occur during the bottom cycles as the whales move their tokens to cold storage. Massive inflows, however, occur during the price rallies as the top accounts look to make a profit.
The current Bitcoin run that started in March 2020 has so far experienced three main cycles. The first (black) cycle happened when Bitcoin crossed the historical resistance level of $11,000 in August 2020. While initially there was a massive inflow, it soon turned into outflows as the holders believed the rally would not hold long enough.
The second wave occurred when Bitcoin hit its then all-time high of $20,000. There was the initial profit-taking before sustained outflow. The third cycle happened when most traders opted to take their profits as the Bitcoin market had soared but was now heading back down around Mid 2021.
The current cycle mirrors the second, given that Bitcoin has just hit another all-time high of over $64000. The number of new accounts holding around 100 to 1000 BTC has been steadily increasing through the year. No changes within the year seem to dampen the quest to own more Bitcoin.
What does the sustained BTC purchasing by the whales mean for Bitcoin?
Given the influence of the Bitcoin whales on the market, their actions tend to depict the state and future of the leading cryptocurrency. Even Though Bitcoin has had some price variations in the year, the whales do not seem interested in letting go of the currency.
An example is when Bitcoin dropped from the values of over $64,000 to the lows of around $30000 by August 2021. At any other time, this would have led to a massive sell-off. Instead, the Bitcoin whales accounts kept on increasing.
It is, therefore, crucial to conclude that the whales have gained the Bitcoin market conviction. They believe in the power of the token bouncing even if it goes down for some time.
Better still, another thought is that the whales might be eyeing even top figures in the future. Already, some experts have predicted that Bitcoin value will hit 6 figures within the next few months. Some experts also believe the coin will eventually hit $500k in the long run.
With the whales not looking to cash in for-profits even as Bitcoin hits an all-time high, there are hopes of even better future performance.