Insights into Whales’ Behavior in the Crypto Market
Ki Young Ju, the co-founder and CEO of CryptoQuant, has shared valuable insights into the behavior of whales in the cryptocurrency market. He specifically focuses on their preparations for market growth towards the end of 2023.
Whales Actively Opening Long Positions in August
In a recent post, Ju highlights that whales, significant holders in the crypto market, have been actively opening long positions when Bitcoin (BTC) was priced at $29,000. This accumulation phase started in early August 2023.
1/ Whale traders opened giga long positions at $29k.
— Ki Young Ju (@ki_young_ju) December 4, 2023
Furthermore, Ju notes that many whales entered the market during a cyclical low for BTC, which coincided with the collapse of the FTX crypto exchange in November 2022. He believes this is evident from increased transfers of cryptocurrencies to derivative trading platforms during that period.
In October, there was increased whale activity in the United States, as indicated by a rise in markups on the Coinbase premium index and assets on the Chicago Mercantile Exchange (CME).
Ju suggests that despite retail investors not entering the market during this period, the supply of BTC may struggle to meet the demand from large investors. Therefore, he posits that whales are unlikely to sell their Bitcoin reserves.
Whales Influenced BTC Surge
Data provided by Ju shows that Bitcoin whales have played a significant role in supporting the current price action since August. During this period, Bitcoin reclaimed the higher price range around $20,000 and approached the critical resistance level at $30,000.
On December 4-5, Bitcoin reached a yearly high, trading above $42,000. Over the past month, its price has surged by almost 19%, and since the beginning of 2023, it has increased 2.3 times. This bullish momentum is attributed to expectations of the U.S. approving exchange-traded funds (ETFs) for direct cryptocurrency investment by institutional investors.
Additional data from Material Indicators, highlighted by analyst Keith Alan, confirms increasing buying pressure from whales. Alan suggests that this behavior aims to attract liquidity to the market so that whales can profit from their positions by “distributing” or “dumping” coins on retail investors once they enter.
Hot Take: Whales’ Preparations for Crypto Market Growth
The behavior of whales in the cryptocurrency market indicates their preparations for market growth towards the end of 2023. They have been actively opening long positions and accumulating Bitcoin during a cyclical low. This has influenced the surge in BTC’s price since August.
With expectations of U.S. approval for ETFs, institutional investors are driving bullish momentum in the market. However, it is important to note that once retail investors enter and provide liquidity, whales may look to profit from their positions by selling their coins. As we move forward, it will be interesting to see how the dynamics between whales, institutional investors, and retail investors shape the crypto landscape.
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