Or, in other words, the short-term prospects of Bitcoin are looking a little bleak. Blockchain data shows that larger investors are reducing their Bitcoin holdings at a quick pace.
Whales, so to speak.
These large investors have the ability to influence markets, and influencing they are.
According to the latest intelligence provided by Glassnode, the number of whale entities — clusters of wallet addresses held by a single network participant holding at least 1,000 bitcoins — fell to a 5.5-month low of 1,943 on Monday.
The metric has dropped by 60, or 3% in the past five days, extending the decline from a record high of 2,237 achieved on February 7. Whale selling had eased off in the second half of April, which is when things had stabilized a bit.
This divergence between these two metrics, the number of whale entities and the price of Bitcoin, is a cause of concern for the bulls.
And that is because, from October 2020 to February 2021, the number of whales had risen in lockstep with the price of the cryptocurrency. This was a validation of the narrative that the rally over this period was the product of increased participations by large investors.
As for Bitcoin’s price, the value has generally been restricted to the $50,000 to $60,000 range since mid-March amid continued selling by whales. That is to say, retail investors alone have been struggling to drive the rally.
Recent market-wide price action suggests that investors focus has shifted from Bitcoin to Ether and other alternative cryptocurrencies, also known as altcoins.
Bitcoin is currently trading at $56,323 at the time of going to press.
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