Are the Whales Hoarding Stablecoins? What does this mean for Bitcoin and Altcoin prices?
This morning, the major cryptocurrencies are trading negative after seeing a brief bullish run yesterday and the day before yesterday. Furthermore, the cryptocurrency market in general is experiencing increased selling pressure. This is most likely a direct result of the Federal Reserve’s decision to raise interest rates by 50 basis points.
According to the data provided by Santiment, the main players are gradually returning to the cryptocurrency market, which translates into an overall increase in purchasing power.
On-chain data shows that the whales have resumed their activities and have been accumulating stablecoins such as USDT, USDC, BUSD, and DAI. These addresses are usually those with a holding of $100,000 or more, allowing them to accumulate many stablecoins.
The green line shows the daily closing price of Bitcoin for the past year. The green area shows the part of the Bitcoin supply owned by the largest Bitcoin addresses, those with 100 Bitcoins or more but less than 10,000 Bitcoins.
The red line indicates the supply of Tether (USDT) owned by addresses with $100,000 to $10,000,000. The orange line represents the supply of Binance USD (BUSD) owned by addresses with values ranging from $100,000 to $10,000,000.
The blue line represents the supply of USD Coin (USDC) owned by addresses with values ranging from $100,000 to $10,000,000. The yellow line represents the supply of Dai (DAI) owned by addresses with values ranging from $100,000 to $10,000,000.
Investors now understand, as a result of the rate hike, that the Federal Reserve may still maintain its aggressive monetary policy in 2023, even though the rate hike was less significant than in previous years. And although we had anticipated that it would be less severe as the new year began, the decision made by the Fed shows that it most likely will not be the case.
According to statistics provided by CoinGecko at the time of writing, Bitcoin, the most valuable cryptocurrency as measured by market capitalization, was trading for $17,673, a decrease of 0.7% over the past twenty-four hours. The price of one Ether has dropped 2.6% in the last day and is now at $1,288.
Are Whales Selling More Crypto?
It is very clear that investor mood has a big impact on whether the price of cryptocurrencies goes up or down. And given the recent events surrounding FTX and the Federal Reserve’s decision to raise interest rates, they may not be feeling very bullish right now.
Data from Santiment indicates that following the spectacular gains in value that cryptocurrencies achieved in 2020 and 2021, Bitcoin whales have been steadily dumping their holdings for the past 14 months. Along with these sales, prices have been steadily dropping.
However, a change may be on the horizon today. Although there may be no prices yet, the whales are finally stockpiling instead of selling. The chart above shows that there are nonetheless huge rallies.
source: coinpedia.org
