Small trader selling of Bitcoin contrasted with the rise of whale and shark exploitation

Bitcoin has experienced its most significant decline in the current cycle and is currently trading more than 25% below its all-time high.

The data also suggests that BTC’s current bearish period has led to contrasting behavior among investors with whale and shark portfolios, which represent a different pattern than smaller holders.

Rise of large Bitcoin wallets

The world’s leading crypto has been affected by the distribution of confiscated tokens from the German government and the defunct crypto exchange Mt. enjoy

According to the latest analysis from crypto analytics platform Santiment, small traders have been actively offloading their BTC holdings, potentially due to fear, which has contributed to the current selling pressure in the market.

In contrast, there has been a notable increase in the number of whales holding 1,000 BTC or more, and sharks, with 10 to 1,000 BTC, are increasing their bitcoin holdings and have remained unfazed by the factors that have driven the small traders to reduce their deposit. . In fact, July has seen a net increase of over 261 wallets that now hold at least 10 BTC.

This shift suggests that larger and more established investors are increasingly confident in bitcoin’s long-term potential, possibly signaling a bullish outlook despite the crypto facing its deepest correction since late 2022.

More superficial correction than previous cycles?

According to Glassnode’s “The Week Onchain” newsletter, the current correction is significantly smaller compared to previous cycles, indicating strong market structure and reduced volatility as BTC matures as an asset class. Glassnode analysts further noted that the selloff has resulted in 83% of the supply of short-term holders (addresses that have held bitcoins for less than 155 days) falling into unrealized losses.

Their estimates show that 2.9 billion BTC (about $166.75 billion at current rates) of the 3.2 billion BTC ($184 billion) held by short-term holders were held below the its cost base due to the recent drop to $53,000. This has put considerable pressure on Bitcoin and the broader cryptocurrency market.

“However, declines throughout our current cycle remain favorable compared to historical cycles suggesting a relatively robust underlying market structure.”

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