High-Volume Bitcoin Investors Continued to Buy BTC in July

Often a key tool in timing market moves, high-volume bitcoin (BTC) investors rapidly increased their holdings throughout July to take advantage of the two-way price volatility.

According to data tracked by blockchain analytics firm IntoTheBlock and TradingView, owners or addresses holding at least 0.1 percent of BTC’s circulating supply purchased more than 84,000 BTC worth $5.4 billion at the current market price, the largest single-month figure recorded in terms of BTC since October 2014.

The accumulation progressed in the form of investors chasing lows and not buying during recoveries when the price fell below $55,000 in early July. According to CoinDesk data, BTC closed July with a 3% gain.

The strategic accumulation likely indicates a strong belief that the prolonged consolidation phase between $50,000 and $70,000 will eventually end with a bullish breakout and will be an extension of the rally that started at $16,000.

Analysts are quite optimistic about bitcoin’s price prospects.

“A potential rate cut in September could provide bullish sentiment and increase liquidity in the market overall,” said Jag Kooner, head of derivatives at Bitfinex. “This would be positive for bitcoin and other cryptocurrencies as investors look for higher yields outside of traditional assets. All of this could put upward pressure on bitcoin’s price and drive ETF inflows as investors look to capitalize on a favorable environment for risk assets.”

Federal Reserve Chairman Jerome Powell said yesterday that interest rates could be cut by September, stressing that economic data should support potential renewed liquidity easing. The central bank held its benchmark interest rate steady at 5.25%-5.50% as expected, maintaining the status quo.

“The Fed is trying to have a ‘soft landing,’ and if the data allows them to make cuts, then we think they will seize the opportunity. We expect the authorities to start moving monetary policy from the ‘restrictive’ zone to the ‘less restrictive’ zone starting in September, with additional cuts in November and December,” Kooner said.

According to CCData, the total market value of stablecoins increased by 2.11 percent in July to $164 billion, reaching the highest level since April 2022. “This development is the highest monthly increase in stablecoin market value since April and reflects new capital inflows into the markets, as reflected by the positive price action of digital assets in July,” CCData said in the report shared with CoinDesk.

Kooner added that the diminishing impact of negative news gives confidence to bulls.