Crypto market bulls strengthen, large "whales" have increased their holdings by 37,100 BTC in the past 10 days

Since the U.S. Department of Labor released the CPI data, the cryptocurrency market has been on an upward trend following the U.S. stock market. Bitcoin and Ethereum have soared by nearly 20% in just one week. This momentum has driven almost all altcoins in the market, and the total market value of global cryptocurrencies has reached $1 trillion for the first time since November 2022. Bitpush terminal data shows that since Sunday, Bitcoin has been trading sideways in the range of $20,500 to $21,500. As of press time, Bitcoin is changing hands around $21,300, with a 24-hour increase of about 2%.

“Whales” rush in to push up prices

A chart shared by on-chain data aggregator Santiment explains why Bitcoin jumped to recent highs above $21,000: Multiple groups of Bitcoin holders have shown some strong accumulation recently, with large “whales” accumulating 37,100 BTC in the past 10 days.

The chart shows that the massive buying phenomenon of the past two months occurred before BTC price rose from levels below $17,000, and these purchases contributed greatly to these price surges.

According to Santiment, wallets holding 10 to 100 BTC prevented Bitcoin from falling below the $16,700 level, with the owners of these wallets buying up to 105,600 Bitcoins in the past 10 weeks; then small "whales" (wallets holding 100 to 1,000 BTC) accumulated, adding 67,000 Bitcoins in the past eight weeks. Santiment believes that this pushed Bitcoin to rebound to the $18,000 level; finally, "big whales" intervened (wallets holding 1,000 to 10,000 BTC), accumulating 37,100 BTC in the past 10 days. It is precisely because of this accumulation that Bitcoin has recently been able to quickly and continuously break through at higher levels, briefly rising to the $21,000 level.

The current rally has gained momentum very quickly as both large and small whales have accumulated. However, the dynamics of wallets holding 1,000 to 10,000 BTC are still worth watching, because if these whales start selling again, the upward trend could reverse.

Bitcoin mining difficulty rises

Some bitcoin mining companies have been eliminated by falling prices in the bear market. These companies use energy-intensive machines to verify transactions and mint new tokens, and have had to face bankruptcy under the pressure of plummeting prices and rising energy costs. Vijay Ayyar, vice president of corporate development and international at cryptocurrency exchange Luno, said that historically, this is a good sign for bitcoin.

These participants have accumulated a large amount of tokens, making them some of the largest sellers in the market. This removes much of the remaining selling pressure on Bitcoin as miners sell off their holdings to pay down their debts.

Recently, however, Bitcoin’s network “difficulty” has been increasing, meaning miners are deploying more computing power to release new coins into circulation. According to BTC.com, mining difficulty hit a record high of 37.6 trillion on Sunday, meaning it takes an average of 37.6 trillion hash operations to find a valid Bitcoin block and add it to the blockchain.

Marcus Sotiriou, market analyst at digital asset broker GlobalBlock, said in a report: "Bitcoin mining difficulty measures how hard it is to create the next block of transactions. After winter storms caused some miners to shut down, Bitcoin mining difficulty fell 3.6% before the last update. However, miners now appear to be back online with new, more efficient machines."

Will BTC return to $30,000 this year?

Following Sunday's high of $21,345.25, BTC fell to an intraday low of $20,681.98 early Monday. Analyst Eliman Dambell said the decline was because bulls' momentum was not enough to break through the $21,400 resistance level, with the 14-day relative strength index (RSI) hovering in the overbought zone. A further retracement is likely this week, with sellers' potential target price of $20,000.

Burniske, a well-known cryptocurrency analyst and former partner of ARK Invest, also put forward his analysis of the crypto market in a tweet. The analyst said that the current market situation may not be a short-term rebound, and we may see a situation similar to 2019. In 2019, Bitcoin and Ethereum rose more than 4 times during the year, and analysts expect the crypto market to repeat a similar phenomenon.

Burniske mentioned that he would be happy to buy on dips if the market retraced significantly. It is worth noting that Burniske's prediction is based on wave-trading, where investors and traders switch positions between medium- and long-term trends. During this period, traders do not need to pay special attention to market conditions, whether they are corrections or accumulation.

According to CNBC, CoinShares Chief Strategy Officer Meltem Demirors expects Bitcoin to trade between $15,000 and $20,000 on the lower side. As for the upper side, she thinks it will be between $25,000 and $30,000 this year. She believes that the massive forced sell-off that hit the market last year is now over, but the amount of money flowing into Bitcoin is not enough at the moment.

Anthony Scaramucci, founder of SkyBridge Capital, is more optimistic. He bets that Bitcoin will continue to rise in 2023, saying it could hit $50,000 or even soar to $100,000 in the next few years.