Tag: Accumulation

Ethereum Experiences Accumulation Trend as Price Continues Trading Above $3,000

by Blockchain News

After recently breaching the psychological price of $3,000, Ethereum (ETH) continues trading above this level based on regained momentum.

The second-largest cryptocurrency based on market capitalization was up by 3.22% in the last 24 hours to hit $3,050 during intraday trading, according to CoinMarketCap.

 

Ethereum has been experiencing notable accumulation, illustrating more demand. Market analyst under the pseudonym Webthreewizard explained:

“Despite volatility in ETH, the mean coin age of ETH continues to grow steadily, indicating an accumulation trend.”

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Source:Santiment

 

Is Ethereum creating a bottom?

Open interest in the ETH ecosystem has been building up, raising the question of whether a bottom is being created. The co-founders of market insight provider Glassnode stated:

“Ethereum open interest signals a potential bottom as investors begin to position themselves for the next big move.”

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Source:Glassnode

 

Ethereum set an all-time high (ATH) of $4,850 in November last year, but it has not been able to reclaim this zone. 

 

On the other hand, speculative demand for Ethereum calls continues to rise, illustrating a bullish sign.

 

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Source:Glassnode

 

Ethereum’s upward momentum recently made it beat Bitcoin on the weekly chart amid increased optimism about the Merge.

 

The much-anticipated Merge will serve as the biggest software upgrade in the Ethereum ecosystem because it will prompt a transition from the current proof of work (PoW) to a proof of stake (PoS) framework, which is deemed more environmentally friendly and cost-effective.

 

It is slated for the second quarter of this year, and it is expected to accelerate Ethereum’s deflationary aspect. Crypto research firm LuckyHash had previously noted that the Merge would lead to a 1% annual deflation rate.

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Ethereum Whales Continue Buying from Weak Hands, Ramping up their Position by 200,000 ETH

by Blockchain News

In the past few days, Ethereum (ETH) whales have been on a buying spree as their accumulation continues. 

Market insight provider Santiment confirmed:

“Whale addresses holding 10K or more ETH have added 200K ETH from weak hands since January 20, worth ~$497.2M.”

This huge accumulation has not been seen in the last two months, suggesting that whales are back to their buying game.

The crypto market has been dented by massive liquidations, which made Ethereum hit a 6-month low. As a result, the number of ETH addresses in profit reached a 5-month low, alluded to by crypto analytic firm Glassnode.

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Source: Glassnode

Nevertheless, developments like huge whale accumulation offer bullish sentiments. Ethereum was down by 2.32% in the last 24 hours to hit $2,435 during intraday trading, according to CoinMarketCap.

The second-largest cryptocurrency faces notable resistance at the $2,500 level, which it has to overcome for a rebound, according to crypto analyst Ali Martinez. 

On the other hand, significant support lies at the $2,200 zone because approximately 360,000 addresses hold 9.6 million ETH.

Options trader John Wick believes that Ethereum was consolidating a bottoming pattern attempting to break out. He stated:

“Ethereum showing the same bottoming pattern trying to break out of the resistance zone. Needs to see more upside from Bitcoin to breakout.”

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Source: TradingView

Market analysts aired similar sentiments under the pseudonym TheCryptoCactus that Ethereum’s journey towards $3,000 would be reached if resistance at the $2,850 level would be flipped to support.

“If you longed the bottom, it’s easy to hedge here. Need to get a valid S/R flip of $2850. Personally, would rather wait till we flip $3000 into support again and then just ape a huge position,” TheCryptoCactus pointed out. 

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Wait and see approach: 3/4 of Bitcoin supply now illiquid

by Cointelegraph

Bitcoin markets have been consolidating since the beginning of the year, but on-chain metrics are painting a more positive picture as more of the asset is becoming illiquid.

On-chain analytics provider Glassnode has been delving into Bitcoin supply metrics to get a better view of the longer-term macro trends in its weekly report on Jan. 3.

The findings revealed that although the asset has been trading sideways so far this year, more BTC has become illiquid. There has been an acceleration in illiquid supply growth which now comprises more than three quarters, or 76%, of the total circulating supply.

Glassnode defines illiquidity as when BTC is moved to a wallet with no history of spending. Liquid supply BTC, which makes up 24% of the total, is in wallets that spend or trade regularly such as exchanges and hot wallets.

“We can see that over the final months of 2021, even as prices corrected, there has been an acceleration of coins from liquid, into Illiquid wallets.”

The figures suggest that more Bitcoin is being transferred into storage indicating an increase in hodling habits and accumulation. The decline in highly liquid supply also hints that there may not be a major selloff or capitulation event at any time in the near future.

BTC liquid and illiquid supply as a percent of the total: Glassnode

The researchers concluded that these conditions indicate “divergence between what appears to be constructive on-chain supply dynamics, compared to bearish-to-neutral price action.”

Related: Just 1.3 million Bitcoin left circulating on crypto exchanges

In the same report, Glassnode stated that the total supply held by long-term holders has plateaued over the past month or so. This suggests that longer-term investors have stopped spending or selling coins and have become hodlers or even accumulators at this stage. “This provides another constructive view of market conviction,” it concluded.

The current supply held by long-termers is 13.35 million BTC, a decline of just 1.1% from October’s high of 13.5 million coins. Glassnode defines these long-term holders (LTH) as wallets or accounts that have held their Bitcoin for more than 155 days.

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MicroStrategy Acquires Extra 7,002 Bitcoins, Bringing its Portfolio to over 121K BTC

by Blockchain News

Ever since institutional investments started trickling into the Bitcoin market, the leading cryptocurrency has experienced exponential growth, with its market capitalization topping $1 trillion.

One of the notable institutional investors includes American business intelligence firm MicroStrategy that has continuously accumulated Bitcoin to 121,044 BTC over the past year. The firm’s CEO Michael Saylor confirmed the purchase of an additional over 7,000 Bitcoins and said:

“MicroStrategy has purchased an additional 7,002 Bitcoins for $414.4 million in cash at an average price of ~$59,187 per Bitcoin. As of 11/29/21 we hodl 121,044 Bitcoins acquired for $3.57 billion at an average price of $29,534 per Bitcoin.”

Microstrategy bought 21,454 Bitcoins worth $250 million for the first time in August 2020, following a new capital allocation strategy to maximize its shareholders’ long-term value. 

Saylor believes that Bitcoin becomes the principal asset in the firm’s treasury reserves because it showcases itself as a legitimate investment vehicle superior to cash. Since then, Microstrategy has not relented in its quest to accumulate more BTC because it usually takes advantage of buying the dip.

Saylor’s Bitcoin advocacy has also not gone unnoticed, as he previously stated:

“We find the global acceptance, brand recognition, ecosystem vitality, network dominance, architectural resilience, technical utility, and community ethos of Bitcoin to be persuasive evidence of its superiority as an asset class for those seeking a long-term store of value.”

Meanwhile, Thailand seeks to revamp its ailing tourism sector by targeting crypto investors. This is based on plans by the Tourism Authority of Thailand to collaborate with a local crypto exchange and lawmakers to accept crypto payments for travel.

Therefore, this approach intends to breathe life into the nation’s tourism industry that has lost approximately $80 billion through the Covid-19 pandemic. 

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Ethereum Whales’ Accumulation Mode Continues as Price Tops $3,200

by Blockchain News

Days after the London Hardfork went live, Ethereum (ETH) has been experiencing an uptick in prices as the second-largest cryptocurrency is set to become deflationary based on this upgrade. 

ETH was up by 16.52% in the last seven days to hit $3,228 during intraday trading, according to CoinMarketCap. 

Ethereum whales are not relenting in their accumulation quest because addresses with more than 100k coins now hold 43.7% of ETH supply, as acknowledged by Santiment. The on-chain metrics provider explained:

“Ethereum whale addresses aren’t stopping their accumulation as prices hover above $3,100. Three years ago to the day, addresses with 100k+ ETH owned 35.8%. Today, they own 7.9% more of the second market cap asset’s total supply. There are 1,338 of such addresses.”

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These statistics show that Ethereum whales’ accumulation has been on an upward trajectory because they owned 35.8% of ETH supply three years ago compared to the current 43.7%.

Is Ethereum eyeing the $4,000 level?

According to market analyst Ali Martinez:

“The IOMAP shows that Ethereum could run to $4,000 if ETH manages to close above $3,235. A rejection from this supply barrier could lead to a spike in selling pressure that pushes ETH to $2,700.”

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Martinez believes that a run to the $4,000 level is relatively open because Ethereum currently stands at the zone, which it has to break for more upward momentum to be attained.

On the other hand, Ethereum options open interest recently surged to a two-month high.

 

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ETH was recently boosted after the London Hardfork or EIP 1559 was implemented because a base fee for every transaction carried out will be set. As a result, giving all a fair opportunity. 

Furthermore, users who may wish to conduct their transactions faster than the standard provisions of the network can add a tip to validators to fast-track their transactions. Part of this tip is burnt, helping to improve the monetary policy of the Ethereum network as a whole and making it deflationary. 

With ETH options open interest topping $4 billion, whether this will boost Ethereum’s journey to the $4,000 level remains evident.

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Bitcoin outflows from centralized exchanges surge to 100K BTC monthly

by Cointelegraph

Bitcoin outflows from centralized exchanges have surged to their highest level year-to-date, with roughly 40,000 BTC being withdrawn over the past seven days.

According to the Glassnode’s August 2 The Week On-Chain report, Bitcoin outflows have accelerated to a rate exceeding 100,000 BTC per month for just the third time since September 2019. The on-chain analytics provider estimates that just 13.2% of circulating BTC are currently held on exchanges — a new low for 2021.

“This represents a near full retracement of the significant inflow volume observed during the May sell-off,” the report noted.

BTC Exchange Net Position Change – Glassnode

Outflows surged to nearly 150,000 BTC monthly at the end of April 2020 following the violent “Black Thursday” crash that saw crypto prices tumble by more than 50% in less than two days after then-U.S. President Trump announced a travel ban between Europe and the U.S. in March as the coronavirus pandemic intensified. Despite the aggressive crash, Bitcoin had rebounded by 150% by the end of May 2020, driving heavy accumulation.

Outflows again came close to 150,000 BTC monthly in November 2020 as Bitcoin surged to test its then-record price high of $20,000, with BTC rallying into new all-time highs the following month.

Glassnode notes divergent trends between Coinbase and Binance throughout most of 2021, with Coinbase having experienced significant outflows while Binance has been the largest recipient of BTC.

However, Binance’s reserves are now beginning to dwindle, with 37,500 BTC (worth roughly $1.5 billion) exiting the exchange over the past week.

Coinbase balances remained steady in June. While the exchange received 30,000 BTC in mid-July, 31,000 BTC was withdrawn from the platform this past week.

Related: Traders are withdrawing 2,000 BTC from centralized exchanges daily

Looking at the macro sentiment, the on-chain analytics provider referred to its “Liveliness metric” to identify trends in accumulation.

The metric, which measures the ratio of the sum of coin days destroyed and the sum of all coin days ever created, indicates a broad trend of accumulation following May’s immediate sell-off.

“It seems that HODLing and accumulation is the most likely dominant trend in the on-chain market,” the report concluded.

BTC Liveliness chart: Glassnode