Bitcoin Whale Addresses Reaches Highest Number Since 2019
Whales seem to be accumulating Bitcoin (BTC) amid the continuous price rally. The seven-day moving average of the number of addresses holding 10,000 BTC or more increased to 111 on Wednesday. And this has been the highest level it reached since August 2, 2019, based on the blockchain intelligence firm Glassnode. Then, the said number has boosted by over 11% since early March.
The Stack is a provider of cryptocurrency tracker and index funds. And its co-founder Matthew Dibb explained that the surge in the number of Bitcoin addresses with over 10,000 BTC. And this might result in long-term holders going back online to expand their holdings.
In addition to that, heightened interest from long-term holders and massive investors could become associated with the bullish narrative. This surrounds the macro factors and the soon-to-arrive reward halving.
Interlapse Technologies’ CEO Wayne Chen stated, “Some of these addresses may belong to high-net-worth individuals or groups, who are diversifying into Bitcoin amid the ongoing coronavirus pandemic and ahead of the mining reward halving due in the next two weeks.
Chen is also the founder of Coincurve – a crypto purchasing and spending platform.
They capped the supply of BTC at 21 million. Also, its monetary policy is pre-programmed to chop off the pace of supply expansion by 50 percent every four years.
Thus, a lot of advocates tout Bitcoin as a safe haven asset and an inflation-hedge like gold. Then, they believe that the economic destruction due to the COVID-19 outbreak and the unprecedented money printing exercises done by the global central banks and governments to bode well for BTC’s price.
Halving and More
Global investment platform eToro’s analyst and crypto-asset expert, Simon Peters, said that they think Bitcoin can effortlessly test previous highs over $19,000 as investors search for safe havens away from traditional assets. And this will be amid the deteriorating economic outlook for the U.S. economy and the chances of an ever-increasing monetary supply.
These bullish predictions have been doing the rounds for over six weeks now. And they could attract large investors to add BTCs in their portfolio.
Moreover, there are expectations around that the mining reward halving, due on May 12, would place Bitcoin on a long-term bullish trend. And this might be the reason for the increase in the number of so-called whale addresses.
Also, BTC goes under a process named mining reward halving every four years. Here, it controls inflation by diminishing mining rewards by 50%. After the May 2020 halving, the reward per block mined will fall from 12.5 BTC to 6.25 BTC.
Most investors expect that the crypto’s price will climb following the halving. At the same time, the asset would become scarcer to satisfy demand. Reinforcing the belief is the historical data, showing Bitcoin experienced solid bull runs in the year after previous halvings.
Nonetheless, the reward halving also indicates a 50% reduction in miner’s revenue. Therefore, if the price fails to rally sharply post-halving, small and inefficient miners might stop operations and offload their holdings to cover costs. And this will lead to a price decline.
