The latest data shows that the number of bitcoin (BTC) whale addresses has reached a new record high. This can be considered optimistic, especially considering that the price of BTC rises steadily above $ 50,000.
The increase in the number of whales indicates that investors with a high net worth actively acquire bitcoin when the beef market continues.
Number of addresses containing 1 million bitcoins. Source: Glassnode
Why is the increasing number of whales important?
During upward cycles, the bitcoin price may be threatened with selling too high if whales start selling or making profits from large positions.
When this happens, it causes a sharp decline in growth as the over-indebted futures market begins to decline, undergoing successive liquidations.
But as the whales continue to thrive, the series data show that the basis for the expanded pool is strengthening.
Glassnode analysts explained that there are currently 94,000 BTC addresses that contain over $ 1 million in Bitcoin. They said:
NOTE: There are now over 94,000 Bitcoin # addresses containing at least $ 1 million in BTC. The sharp increase in mid-December indicates the time when BTC exceeded $ 20,000 dollars, making all the first millionaire addresses (50 BTC bonuses) millionaires. addresses “.
Meanwhile, researchers at Whalemap, a data mining platform that tracks whale activity, have found a similar trend.
The researchers said that the number of addresses containing 1,000 to 10,000 BTC has decreased in previous bull cycles. However, the whale population increased significantly during the last cattle cycle. They said:
“An interesting macro cycle: the number of items from 1,000 to 10,000 BTC decreased during the previous bull run, but this time it only accelerated. The second image also shows exactly where these portfolios get BTC. ”
The ideal short-term scenario is to write off the futures market.
Right now, Bitcoin contains the components to watch the rally continue. Whales are buying, trading volume is generally increasing, and there is significant institutional interest in Bitcoin.
However, one of the biggest risks in the market is the over-indebted futures market. As of February 18, the forward financing rate for both Bitcoin and Ether was above 0.15%.
The usual financing rate for cryptocurrencies is around 0.01%. When the financing rate rises, it indicates that most of the market is buying or selling.
The problem arises when Bitcoin or Ether (ETH) notices a small drop. Since the market is heavily exploited, this can lead to severe deflation, often with a sharp correction.
Given the higher financing rates, the probability of correction in the short term is still high. Given that there are often corrections in the cryptocurrency market over the weekend, a reversal is still likely in the next few days, despite the bullish structure in the BTC and ETH markets.