2023-6-15 23:41 |
Bitcoin, the world’s largest cryptocurrency by market value, has continued to trade sluggishly since mid-April, with last week’s regulatory scares pushing its price below $26,000.
However, since Monday, the top cryptocurrency has exhibited unexpected resilience, with investors temporarily setting aside concerns over Securities and Exchange Commission (SEC) lawsuits against Binance and Coinbase and turning their attention to the upcoming Federal Reserve’s interest rate decision.
Notably, the retracement of Bitcoin, especially since last year’s decline, has generated a surge of curiosity, enticing many investors to seize the opportunity by purchasing the dip.
On Tuesday, blockchain analytics firm Glassnode reported that Bitcoin “Shrimps” and “Crabs” have increased their holdings significantly, accumulating nearly 1 million BTC since the collapse of the cryptocurrency LUNA in May 2022. Shrimps are entities that hold less than 1 BTC while crabs are those that own less than 10 BTC.
“Following the LUNA collapse, Bitcoin entities with less than 10 BTC (Shrimps – Crab) have shown their resilience, increasing their relative share of the circulating supply from 13.72% to 17.54%, a 3.82% increase equivalent to +790K BTC.” Tweeted Glassnode.
But this is not the only cohort that is buying the dip. Another firm, Santiment, noted a bullish trend in Bitcoin’s accumulation patterns despite the falling price. As the altcoin market experienced a frenzy, Santiment highlighted a divergence between Bitcoin’s accumulating whales and the declining price.
According to the firm, Whale holdings in Bitcoin increased by approximately 1,000 BTC daily, indicating that more prominent investors were accumulating more Bitcoin even as prices dropped.
“With whale holdings moving up by ~1K $BTC per day while prices fall, there is reason to believe a strong rebound can occur,” tweeted the firm.
Elsewhere, other Bitcoin metrics also seem to be improving. According to Glassnode data, Bitcoin’s short-term holders have experienced a significant profit-driven phase since the start of the year. However, as the spot price of Bitcoin continued to trend lower, the STH (Short-Term Holders) Realized Profit/Loss Ratio has now approached a critical decision point, indicating an equilibrium position.
Glassnode suggested on Tuesday that a bounce off the equilibrium position “would be considered constructive”, signalling support for Bitcoin. Conversely, if the ratio decisively falls below the equilibrium point, it would indicate market weakness and the possibility of more price drops. The market thus awaits this pivotal moment to assess the future trajectory of Bitcoin.
At press time, BTC was trading at $25,114, down 3% in the past 24 hours. Notably, Bitcoin’s current price range is regarded as robust support. Further, the presence of a bullish flag pattern and inverse head and shoulders patterns suggest the possibility of an upcoming bullish rally.
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