Is Bitcoin’s Rising Whale Wallets and Hash Rate Signal the Calm Before the Storm?

Bitcoin whale wallets, defined as those holding 100 or more BTC, have increased by 297 lately. The latest figure represents an increase of 1.9% in the last two weeks.

On the other hand, wallets holding less than 100 BTC have decreased by 20,629, a decrease of 0.1% during the same period.

Bitcoin whales indicate a potential market rally

According to crypto analytics platform Santiment, this change indicates that the largest stakeholders in the crypto market are actively hoarding BTC, taking advantage of selling pressure from retail traders.

Historically, this whale behavior has led to bullish results for bitcoin, essentially indicating that the market may be preparing for a potential push to the upside as larger players strengthen their positions.

This accumulation trend aligns with another analysis by CryptoQuant, which revealed that bitcoin whale holdings have reached an all-time high, with approximately 670,000 BTC currently in their possession. This build-up is a strong indicator of confidence in the market’s long-term outlook.

“This build-up phase can be characterized as the calm before the storm in the medium to long term. The real surge in Bitcoin growth begins after the whales gradually reduce their holdings until they reach negative percentage change values.”

Also, the looming concern is whether bitcoin will hit a new price high between the US presidential election and the end of November. Failure to do so could portend serious challenges to the ongoing bull cycle, raising alarm bells about possible recession.

Basics of the Bitcoin network positive

The growing whale wallets come at a time when the fundamentals of the Bitcoin network are showing encouraging signs. The network’s hash rate, for one, recently hit an all-time high. This increase in the hash rate reflects an intensified competition among miners, which leads to an increase in the difficulty of mining.

It also means that the intrinsic value of BTC is on the rise, making it a more attractive investment for savvy investors, often called SmartMoney. Additionally, since mid-September, there has been a noticeable increase in the number of bitcoin addresses active over the past 30 days, correlating with a significant increase in total fees as on-chain transactions gain momentum.

In the past, spikes in the price of bitcoin have been accompanied by an increase in active addresses and transaction volumes, indicating a healthy network. Even if the market faces a correction or consolidation phase soon, the fundamentals of the underlying network strongly suggest that BTC is on an uptrend path.

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