Bitcoin (BTC) has shown remarkable resilience, revisiting the $70,000 price zone, buoyed by macroeconomic indicators and a surge in market optimism.
With $1 billion being added daily to new whale wallets, Bitcoin could be on the verge of another significant price movement.
Despite minor setbacks and consolidations since May 21, Bitcoin’s overall trajectory remains bullish. CryptoQuant founder and CEO Ki Young-Ju noted that Bitcoin is exhibiting patterns reminiscent of mid-2020, characterized by stable prices yet high on-chain activity.
In a detailed post on X, Young-Ju shared two key charts highlighting the parallels between Bitcoin’s current market behavior and that of mid-2020, indicating a substantial volume of transactions likely occurring outside of public exchanges.
The first chart, covering data up to 2020, highlights Bitcoin’s price with the realized cap for new whales—a metric tracking the total value at which newly acquired Bitcoin by large investors last moved.
BTC Realized cap for new whales 2022 vs 2024. Source: Young-Ju/X
This metric differs from traditional market capitalization by evaluating each unspent transaction output (UTXO) at its last transacted price rather than its current market price, thus reflecting the actual realized value of all coins in the network.
Around mid-2020, this value sharply increased while Bitcoin’s price hovered around $10,000. This period was marked by significant on-chain activity, primarily from over-the-counter (OTC) transactions among institutional players.
BTC fund flow ratio. Source :Source: Young-Ju/X
In the second chart, extending to 2024, a similar pattern emerges. Despite Bitcoin’s price moving sideways for nearly 100 days, the realized cap for new whales shows more pronounced growth.
Young-Ju notes a significant addition of about $1 billion daily into new whale wallets, indicating increased custody activity rather than speculative trading.
Who is selling Bitcoin?
Despite the absence of major price fluctuations, the continued substantial on-chain activity suggests a healthy market undercurrent.
This observation raises the question of who is selling Bitcoin, considering the significant buying by institutional investors and exchange-traded funds (ETFs).
Potential sellers could include retail investors taking profits, miners selling their rewards, or long-term holders liquidating their positions. This equilibrium hints at a balanced market with steady buying and selling.
Potential future trends
If the current trend, resembling Bitcoin’s on-chain activity in 2020, continues, it could lead to significant price changes. In 2020, increased on-chain activity preceded a bull run that saw Bitcoin reaching new record highs in 2021. If history repeats itself, Bitcoin might experience another prolonged period of upward price movement.
Crypto analysts suggest that Bitcoin is currently fighting its last resistance of $69,000 before setting new all-time highs (ATHs)—a peak last seen during the 2021 bull run.
Similarly, the Puell Multiple indicator, which evaluates Bitcoin value based on its mining activity, has recently fallen into the “discount range.” This indicator assesses Bitcoin’s mining economy by comparing miners’ daily revenue to the 365-day moving average of this revenue.
When the Puell Multiple drops into this range, it suggests that Bitcoin may be undervalued compared to its historical performance. Such a situation often presents a favorable buying opportunity for investors anticipating future price increases.
Researchers at CryptoQuant believe that the market may be adjusting to a new phase of scarcity, potentially preparing for a rally. The current price range appears to be a suitable accumulation zone despite widespread fear.
With substantial daily accumulation in whale wallets and the market maintaining equilibrium, the future looks promising for Bitcoin.
As BTC trades at $68,271, up 0.58% for the day and advancing 19.6% on its monthly chart, the market sentiment remains optimistic for potential future rallies.
The consistent high-level investments and strategic insights underscore a market that is slowly but steadily gearing up for another upward trajectory, echoing the vigorous activities of mid-2020.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
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