A Contrast in Sentiment: Bitcoin Whales Accumulate while Ethereum Whales Sell Off
This week, there has been a noticeable difference in the behavior of large holders of the top two cryptocurrencies. On-chain analysis firm Glassnode has reported that Ethereum whales, who hold 1,000 or more ETH (worth approximately $1.5 million), have been selling off their holdings since 2020, with $20 million worth of ETH being sold. In contrast, Bitcoin whales, holding 1,000 or more BTC (roughly $26.9 million), have been accumulating quietly, with only a couple of sharp drops.
Theories and Speculations on Social Media
The apparent disparity in whale activity has sparked various theories on social media. Some individuals in the Bitcoin community have taken the opportunity to criticize the Ethereum community. Steven Lubka from Swan, a Bitcoin financial services company, noted that they have observed high-net-worth individuals looking to exchange their ETH for BTC due to regulatory concerns surrounding Ethereum.
Jesse Shrader from Amboss, a data analytics firm for the Lightning Network, believes that Bitcoin offers better money functionality compared to Ethereum’s complexity and potential risks associated with smart contracts and protocol changes.
Considering Staking and Smart Contracts
However, some experts argue that the conclusions drawn from Glassnode’s data may be incomplete. Kunal Goel from Messari points out that transfers to staking contracts may appear as selling on-chain but are not actual sales. Staking in the Ethereum network requires users to lock 32 ETH in a smart contract for transaction validation, which could explain the alleged drop in holdings by large entities.
André Dragosch from Deutsche Digital Assets adds that Glassnode’s metrics do not account for Ether tied in smart contracts and highlights that the percentage of ETH supply held by the top 1% of addresses has not declined. He considers the drama surrounding ETH whale selling to be insignificant.
Hot Take: Bitcoin and Ethereum Whales Remain Bullish
While the data may initially suggest a contrast in sentiment between Bitcoin and Ethereum whales, it is important to consider additional factors such as staking and smart contracts. Ultimately, both Bitcoin and Ethereum whales continue to demonstrate bullish behavior.
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