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Whales scooped up $5.5B in Bitcoin as BTC price dropped below $36K

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Large holders of Bitcoin didn’t succumb to panic amid the recent drop in quotations and increased their positions.

The sharp correction resulted in Bitcoin (BTC) losing over $ 100 billion of its valuation in the blink of an eye. Of course, the turmoil is being felt in the cryptocurrency market, which is down 13% at the time of publication.

However, as it happens during every market correction, Bitcoins go from weak to strong hands. The 30% drop in the price of the first cryptocurrency has become a buy signal for many large investors. So, when the price of Bitcoin fell below $ 36,000, the whales began to aggressively buy the fall. In this connection, the volume of spot exchanges in four hours exceeded 5.6 billion dollars, which is an extreme indicator even for a 12 percent price movement.

Thus, we can say that the growth in the number of Bitcoin whales in such circumstances indicates the confidence of large investors in the short-term nature of the correction. Note that the “whales” were buying Bitcoins even during the COVID-19 pandemic.

Huge panic among short-term Bitcoin investors

Over the past weeks, there has been a lot of negative regulatory news regarding Bitcoin (BTC) and cryptocurrencies. Against this backdrop, as reported by Glassnode, the bulk of the sales were made by short-term investors who have made purchases in the past few months. Thus, during the recent correction, the number of addresses holding less than 0.01 BTC decreased. This could signal the withdrawal of some retail investors from the market.

However, recent market volatility has not worried large institutional players. It would seem that all factors speak of a fall. But the whales, on the contrary, are buying up the first cryptocurrency.

While retail traders are easily intimidated by this kind of news, whales and market makers know how to spot a buying opportunity. Which was the case with today’s drop to $ 36,200. According to Glassnode analysts, the correction was caused by panic selling by short-term investors. While long-term investors were buying “at the bottom”. To date, the hodlers have accumulated 58% of the coins issued into circulation.

Such dynamics will inevitably lead the largest cryptocurrency to take new heights, analysts are sure. Earlier, the CEO of Ark Investment Catherine Wood expressed confidence that the Bitcoin rate will reach $ 500,000 in the foreseeable future. Although, according to Scott Minerd, investment director of Guggenheim Partners, Bitcoin and other cryptocurrencies are just a new tulip rush. At the same time, earlier he could be called a cryptocurrency enthusiast, but recent market events have turned him into a skeptic.

Conclusion

Experts point out that many investors are using Bitcoin as an alternative to gold. And even the increased volatility of the cryptocurrency market is quite natural, because this is a new class of assets. Cryptocurrencies are rising and falling, and May 19 was not a good day for digital currencies. But that’s okay for a relatively new asset. Cryptocurrencies came out of nowhere and became a force in the market. And this situation will remain.

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