CryptoQuant CEO Ki Young-Ju today identified significant similarities in Bitcoin’s market behavior between the present state and mid-2020, a period marked by stagnant prices but high on-chain activity. Young-Ju’s insights were illustrated with two key charts and shared via a post on X, drawing parallels that suggest a strong undercurrent of enormous volume transactions, potentially outside the general public exchange networks.
Bitcoin realized cap for brand new whales | Source: X @ki_young_ju
The primary chart, representing data up until 2020, shows Bitcoin’s price alongside the realized cap for brand new whales – a metric that tracks the mixture value at which the newly acquired Bitcoin by large investors was last moved. It’s a special type of market capitalization that assesses each UTXO at the value it last modified hands, somewhat than its present market price. This metric reflects the actual realized value of all of the coins within the network, somewhat than their current market value.
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This value experienced a pointy increase around mid-2020, precisely when Bitcoin’s price was caught in boredom similar to in recent months, consistently trading across the $10,000 mark. In keeping with Young-Ju, this era was characterised by high on-chain activity which later evaluation suggested involved over-the-counter (OTC) transactions amongst institutional players.
Within the second chart, extending to 2024, an identical pattern emerges with much more pronounced growth within the realized cap for brand new whales, despite Bitcoin’s price showing a sideways movement for nearly 100 days now. The chart indicates a major addition of about $1 billion every day into recent whale wallets, a term typically referring to addresses holding large amounts of Bitcoin, often linked with institutional or highly capitalized individual investors.
What This Means For Bitcoin Price
Ki Young-Ju elaborated on these observations: “Same vibe on Bitcoin as mid-2020. Back then, BTC hovered around $10k for six months with high on-chain activity, later revealed as OTC deals. Now, despite low price volatility, on-chain activity stays high, with $1B added every day to recent whale wallets, likely custody.”
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He further referenced a tweet from September 2020 that corroborated his evaluation, noting that the “variety of BTC transferred hits the year-high, and people TXs will not be from exchanges. Fund Flow Ratio of all exchanges hits the year-low. Something’s happening. Possibly OTC deals.”
This comparison and the sustained high level of the realized cap for brand new whales suggest an ongoing accumulation phase amongst large-scale investors, paying homage to the activity observed in mid-2020. Such movements are generally not visible on traditional crypto exchanges and indicate a powerful institutional interest that may very well be a precursor to significant market moves. Following Young-Ju’s tweet, BTC price rallied by 480% from September 2020 till November 2021.
If an identical move is brewing for Bitcoin price stays to be seen, but the continual growth in Bitcoin holdings amongst recent whales, together with sustained price levels, points to a possible buildup of pressure beneath the apparent calm of the market surface. As observed previously, such conditions may result in substantial price movements once the accrued Bitcoin begins to affect the broader market through either increased liquidity or renewed trading interest.
At press time, BTC traded at $68,271.
BTC price stays below key resistance, 1-day chart | Source: BTCUSD on TradingView.com
Featured image created with DALL·E, chart from TradingView.com