This Bitcoin metric is “one of crypto’s top leading indicators,” according to Santiment, the on-chain analytics firm. The metric in question is the total supply held by Bitcoin investors with at least 10 BTC in their wallets, which has historically been a strong indicator of market trends. These investors, often referred to as sharks and whales, are considered influential figures in the cryptocurrency space.
In recent years, the holdings of this group of investors have been on the rise, indicating accumulation from large holders. Santiment suggests that when these investors accumulate, cryptocurrencies tend to rise, while their dumping can lead to extended bear markets.
The chart provided by Santiment shows a correlation between the behavior of investors in this range and the price of Bitcoin. Notably, their holdings started increasing in October 2019, coinciding with the subsequent bull run in 2021. However, the trend reversed in February 2022 when their holdings began to decrease, ushering in a bear market. The decline halted following the FTX crash in November 2022, and their holdings entered a sideways movement in 2023. Towards the end of the year, the metric started gaining an uptrend again.
This accumulation phase likely started due to the anticipation of spot exchange-traded fund (ETF) approval in January. These investors continued buying after the approval, leading to the rally that propelled Bitcoin to its new all-time high.
Despite recent challenges faced by Bitcoin, the indicator has not flipped, suggesting that more bullish price action could be on the horizon. Currently, Bitcoin is trading sideways around $68,300.