A huge wall of sales orders at $20,000 could cause a significant transfer of wealth from whales to institutions
Bitcoin whales (BTC) seem to be selling to institutions as the supply contraction intensifies below $20,000.
Data provided by various sources indicate that while more BTCs were returning to the exchanges during the week, large buyers are still creating more demand than supply can satisfy.
Inflows to Grayscale’s exchanges and buy-ins
Statistics from the on-chain Coin 98 analysis resource confirmed that in November the investment giant Grayscale bought twice as many Golden Profit created by miners in the same period.
Along with Square and PayPal, the other major companies that are demanding more and more BTC, Grayscale is creating an imbalance in the offer whose only logical result is a price increase.
This scenario has prepared the ground for December, with Grayscale continuing to buy Bitcoin, accumulating over 7,000 BTCs in just 24 hours. According to a report published on December 4, assets under management in Grayscale Bitcoin Trust exceed $10.5 billion.
At the same time this week saw Bitcoin exceed its all-time high and face $20,000, but encounter enormous sales pressure.
After bouncing from low to $18,100 and back to around $19,000, BTC/USD seems ready for another attempt at the decisive level, but the sales dynamics remain unusual. With the wall of $20,000 sales orders still firmly in place, long-standing HODLer and whale looking to exit the market have reliable buyers at their disposal: Grayscale and other institutions.
The tests lead to increased inflows from whales to exchanges this week, a factor that coincides with the $20,000 test. If the sale is already forcing prices down, BTC should move from whales to the stronger hands of Grayscale and its customers.
CNBC: the rich are „accumulating“ Bitcoin
The phenomenon has even caught the attention of mainstream media.
„The total number of accounts buying over $1 million in Bitcoin and moving them out of the exchange has skyrocketed,“ CNBC reported Thursday.
„It has increased 180% from 2017 to this year. According to analysts, this indicates that rich investors are accumulating Bitcoin and then storing it offline in a safer place“.
Moreover, on Friday the total number of Bitcoin addresses in profit compared to the time when the coins were deposited reached a new record, according to the most recent data provided by Glassnode.
On Wall Street, meanwhile, on Thursday there was positive news for the industry. As of January 2021, Bitcoin and hundreds of altcoins will form new cryptocurrency indices created by S&P Dow Jones Indices.