Bitcoin Whales Surge to Highest Levels Since 2021

The number of significant Bitcoin holders, commonly referred to as whales, has surged to its highest count since January 2021, indicating a potential for a price increase.

According to insights from Glassnode and André Dragosch, the head of research for Europe at Bitwise, the count of entities holding at least 1,000 BTC has risen to 1,678.

This uptick in whale accumulation is seen as a promising indicator for Bitcoin's price trajectory.

Increased Whale Activity Signals Strong Demand

Whale entities, defined as clusters of crypto wallet addresses controlled by a single participant holding 1,000 BTC or more, are closely observed due to their capacity to impact market liquidity and prices.

The rising confidence among these large holders aligns with a robust demand for alternative Bitcoin investment options, including U.S.-listed spot ETFs.

In contrast to the growing whale activity, retail investor engagement has noticeably slowed. Data from CryptoQuant reveals that retail investors have added only 1,000 Bitcoin over the past month, marking a historically low accumulation rate.

BREAKING: The total number of Bitcoin whales has just reached the highest level since January 2021! ????
Latest data shows there are 1,678 entities categorized as whales, defined as those controlling at least 1,000 BTC.
New all-time highs incoming? — André Dragosch, PhD | Bitcoin & Macro ⚡ (@Andre_Dragosch) October 23, 2024

Larger Investors Expand Holdings

Meanwhile, larger investors holding between 1,000 and 10,000 BTC have significantly increased their holdings, adding 173,000 Bitcoin this year compared to just 30,000 by retail investors.

“Since the beginning of 2024, larger investors have outpaced retail investors in terms of growth. As of now, retail holdings have grown by 30K Bitcoin, while larger investors have increased by 173K Bitcoin.”

Currently, Bitcoin's price hovers around $67,000, approximately 10% below its all-time high of $73,800. Prices briefly surpassed $69,000 earlier this week before encountering pressure from rising U.S. Treasury yields and a strengthening dollar.

Despite these challenges, analysts remain optimistic about Bitcoin's future performance, with options trading on Deribit indicating potential price targets of $80,000 and $100,000 for the remainder of the year, suggesting the possibility of new record highs.

Bitcoin Futures Open Interest Reaches New Heights

Bitcoin derivatives have also seen significant growth, with open interest (OI) in Bitcoin futures reaching an all-time high of $40.5 billion on October 21.

The Chicago Mercantile Exchange (CME) holds the largest share of Bitcoin futures open interest at 30.7%, followed by Binance at 20.4% and Bybit at 15%.

This surge in open interest aligns with Bitcoin's price nearing the $70,000 mark. Open interest reflects the total value or number of outstanding futures contracts that remain unexpired and serves as a crucial indicator of market activity and investor involvement in Bitcoin derivatives.

An increase in OI can suggest heightened leverage within the market, potentially leading to greater volatility. Periods of elevated open interest often result in significant market movements, especially when prices experience sharp shifts.