As we know, Bitcoin has been trading sideways for practically the last three months now and continues being flat despite small spikes here and there. Now it’s important to look at other metrics besides technical analysis tools and indicators.
Fundamental metrics play a huge role in the development of Bitcoin’s price and value. Not everyone follows these but they can be extremely useful for the long-term. Recently, thanks to a new report from Glassnode we are noticing a significant decline in the number of Bitcoin whales.
A whale typically refers to anyone that owns a big portion of an asset, in this case, the metric is for any address that owns more than 10,000 Bitcoin. Of course, there aren’t many addresses containing this number of coins, however, back in July 2019, there were 120 and now there are only 103. This is quite significant as 17 fewer addresses mean at least 170,000 BTC were either moved or sold.
Of course, this metric can’t really show if the addresses simply split their Bitcoin into other addresses or sold it, however, we can assume that most of them simply sold their coins. While at first glance this may seem like a bearish indicator, it might not be that bad.
In fact, if we carefully examine this metric using another metric, the number of active addresses, we can easily understand if it’s bad or not. The idea here is that if fewer people control a big portion of Bitcoin’s supply, Bitcoin becomes more decentralized. At the same time, this should be considered bad news because it also means people are not willing to hold a lot of Bitcoin anymore, however, considering the number of active addresses is increasing, the metric becomes bullish.
Again, it’s important to take a step back and realize that these kinds of metrics do not have a direct impact on Bitcoin’s price or rather, not an immediate effect on it.
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