On-chain data shows that novice Bitcoin whales have recently seen their losses flatten, a potential sign that their capitulation has paused.
Bitcoin Whale Selling Returned to Neutral Recently
In a new article on X, on-chain analytics firm CryptoQuant explained how the behavior of Bitcoin whales has changed recently. “Whales” refer to BTC investors who hold more than 1,000 cryptocurrency tokens in their wallet balance.
At the current exchange rate, the threshold for the cohort converts to $86.7 million, which is quite significant. The large size of their holdings can allow these investors to exert some influence on the market.
The behavior of whales therefore deserves to be monitored. There are many ways to track whale behavior, one of them being the realized profit/loss indicator.
This metric measures, as the name suggests, the net amount of profit or loss that members of the group as a whole make from their transactions. A positive value indicates that profit taking is dominant, while a negative value suggests that realized losses exceed profits.
Whales can be divided into two subgroups, called short-term keepers (STH) or new whales and long-term keepers (LTH) or old whales. The first group consists of whale investors who purchased their coins within the last 155 days, while the second consists of whales who have held them for more than that period.
Now here is the chart shared by CryptoQuant which shows the profit/loss trend made in Bitcoin for new and old whales over the last few months:
The value of the metric appears to have been neutral for both cohorts in recent days | Source: CryptoQuant on X
As shown in the chart above, Bitcoin’s profit/loss has been mostly in the loss zone for whales since the cryptocurrency’s price saw a bearish change in October.
The New Whales, in particular, are responsible for the majority of losses, with peak losses even exceeding the $600 million mark. “The losses made by the new whales had a significant impact on the price decline from $124,000 to $84,000,” the analytics firm noted.
The chart shows that the losses made by these huge Bitcoin investors have seen a decline recently, as BTC’s bearish momentum has eased and its price has settled into a consolidation phase.
Over the past week, the realized profit/loss has even been minimized to a neutral level for both new and old whales, implying that the largest hands in the market have only moved the coins close to cost.
Whether this suggests the whale capitulation phase is over remains to be seen, but for now, these investors have effectively hit the pause button.
BTC Price
Bitcoin began the week with a recovery rally above $90,000, but the asset quickly declined as it returned to $87,000.
Looks like the price of the coin has gone down recently | Source: BTCUSDT on TradingView
Featured image of Dall-E, CryptoQuant.com, chart from TradingView.com
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