Bitcoin Whales Accumulate as Small Holders Panic Sell, Signaling Return of Bullish Optimism

Bitcoin's recent price struggle encouraged whale and shark wallets to buy more amid the small-scale holders' sell-off.

Bitcoin price struggles have seen smaller traders sell off their holdings, while ‘sharks’ and ‘whales’ have used the opportunity to buy up more BTC.

According to blockchain analytics firm Santiment, the number of addresses that hold at least 10 BTC has increased by 261 this month. These large holders are known as ‘sharks’ (10 to 1,000 BTC) and ‘whales’ (over 1,000 BTC).

The smaller traders are largely panic-selling their holdings in the face of the dip. However, the accumulation by sharks and whales is a sign of strong bullish optimism, which bodes well for Bitcoin’s long-term projections.

Bitcoin price volatility and smaller traders’ sell-off

Bitcoin has experienced major price volatility in recent weeks, falling as low as $53,000 on July 5. The sharp drop in value and the continuous price volatility have forced many smaller traders to sell their holdings. This is likely due to a panic reaction to the plunge in price.

However, holders that fall into the sharks and whales category have been accumulating. Sharks hold 10 to 1,000 BTC, while Whales hold more than 1,000 BTC. For these cohorts, the price decline has created an entry point, allowing them to buy for the long term.

Signs of accumulation and bullish sentiments

One indication of this accumulation is the increase in the number of wallets holding at least 10 BTC. Santiment data shows that over 152,000 addresses now hold 10+ BTC, the highest number since May 21. The increasing rate of accumulation is also reflected in the capital inflow into the crypto market via stablecoins, with the minting of $750 million in USDC during the last seven days on the Solana blockchain.

Moreover, the rise in the Bitcoin accumulation trend score further supports bullish sentiments. According to technical analyst Ali Martinez, the score, currently at 0.4449, “indicates a change in investors’ sentiment, with many now choosing to accumulate $BTC.”

Bitcoin price falls despite increasing accumulation trend score

Despite the increasing accumulation trend score, Bitcoin price has fallen 1% in the last 24 hours, wiping out all its earlier gains in the day. The flagship asset, which rose as high as $59,387, has now dropped to $57,000, highlighting recent volatility.

This price performance is already affecting derivatives traders, with liquidations of both bearish and bullish positions. According to data from Coinglass, $32.38 million was liquidated in the last 24 hours. Most of the liquidated positions came from those who longed for the assets.

Meanwhile, the current price performance marks the worst price correction since 2022. According to Glassnode, this has left most short-term holders with paper losses. Based on the on-chain acquisition price, over 2.8 million BTC are currently being held at a loss.

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