Bitcoin Buzz: Accumulation trend hits 3-year high
According to renowned crypto analyst Ali, Bitcoin has recently witnessed a significant development in its investment momentum, marking a notable shift in the crypto market.
In a post published today
According to the analyst, this increase in the Accumulation Trend Score indicates the growing confidence of larger companies in the cryptocurrency market.
Ali's shared data also shows that the Accumulation Trend Score for Bitcoin has consistently hovered near the high of 1 over the past four months. This persistently high value signals active and sustained accumulation by large investors.
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#Bitcoin is experiencing one of the most significant accumulation series in almost three years!
Notably, the Accumulation Trend Score has been close to 1 over the past four months, indicating that larger companies are accumulating their BTC dollar holdings. This trend shows strong confidence in the market! pic.twitter.com/QcJOEhzBUB
— Ali (@ali_charts) February 1, 2024
A surge in large BTC holdings
Further adding to this nearly three-year accumulation trend series, recent data from Ali showed that the Bitcoin market has welcomed around 67 new “whales.” These companies, each holding over 1,000 BTC, represent a 4.50% increase in this category of investors in two weeks.
This increase in whale activity coincided with a period in which Bitcoin experienced a significant decline and fell below the critical threshold of $39,000. Ali noted: “While some trembled in fear during the recent price correction, Bitcoin whales accumulated more BTC.”
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While some trembled in fear during the recent price correction, #Bitcoin whales accumulated more $BTC!
Around 67 new companies now hold 1,000 #BTC or more, up 4.50% in two weeks. pic.twitter.com/tje3fhznRR
— Ali (@ali_charts) January 30, 2024
This decline was primarily due to a significant outflow from Grayscale, which totaled over $5 billion since the US Securities and Exchange Commission (SEC) approved the Bitcoin Spot ETF.
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As of January 29, 2024, the number of Bitcoins held by Grayscale was 496,573.8166. Furthermore, GBTC’s AUM is approximately $21.431 billion. Following the adoption of the spot ETF, Grayscale users sold a total of 120,500 BTC, equivalent to approximately $5.508 billion.…
— Wu Blockchain (@WuBlockchain) January 30, 2024
However, as this outflow has cooled, Bitcoin has shown signs of recovery and has traded above the $42,500 mark over the past week, registering a 6.1% increase.
BTC price is moving sideways on the 4-hour chart. Source: BTC/USDT on TradingView.com
Is Bitcoin Set for a 40% Surge?
Arthur Hayes, founder of BitMEX, has shifted the focus to the broader financial landscape, providing an analysis of current economic conditions and their potential impact on Bitcoin. His comment is particularly relevant given the recent challenges facing New York Community Bancorp (NYCB) and the banking sector.
The bank's significant stock decline, driven by unexpected losses and a significant increase in loan loss reserves, has raised concerns about the stability and vulnerability of U.S. regional banks, particularly in the real estate sector.
Hayes' comments suggest a possible scenario in the near future in which the Federal Reserve may need to intervene by reinstating the Bank Term Funding Program (BTFP) or similar measures to stabilize the banking sector.
He compares the current situation to the banking crisis of March 2023 and suggests that similar market turmoil could lead to a brief decline in Bitcoin value, followed by a significant recovery.
Hayes posits that such developments could cause Bitcoin, often viewed as digital gold or safe haven, to experience a rise in value similar to the 40 percent increase seen during the previous banking crisis.
Featured image from Unsplash, chart from TradingView
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