The last six months have been difficult for Bitcoin. The world’s largest cryptocurrency has plummeted by more than 70% from its all-time high in November 2021 and is currently trading at $ 19,462. Market capitalization has also declined, starting at $ 880 billion this year and dropping to $ 373 billion at the time of writing.
This decline in reputation has had a widespread impact on the crypto market. For example, the number of Bitcoin millionaires has dropped significantly this year. According to the data archiving tool Wayback Machine, there were 90,902 Bitcoin millionaires on January 5, 2022.
However, as of June 29, 2022, there were only 25,390 wallets holding more than $ 1 million in Bitcoin. This corresponds to a drop of about 72% in just 6 months. Given that there were 116,139 Bitcoin millionaires at the end of October 2021, things seem to be even worse.
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However, as Bitcoin prices continue to test new lows, whales see it as an opportunity to go to a banquet of accumulation. According to Glassnode data, Spot Whales (wallets over 1,000 BTC) made a significant addition to the Bitcoin portfolio in June 2022. Current prices are in the range of December 2020, and whales can lower their average purchase price with low investment.
Whales are the strongest players in the dismantled crypto market. They are market-enhanced veterans who can survive the crypto storm with the simple purchase of additional Bitcoin. These large investors are increasing their coin stockpiles at an astonishing rate of 140,000 BTC per month and currently manage a cumulative total of 8.69 million BTC. This represents 45.6 percent of the circulating supply.
Whales are now very close to owning 50% of the total supply, and experts are worried that it might happen before the end of the crypto winter. This is not a good sign for investors as whales will become the market power and affect prices at every stage.
Ironically, crabs (wallets holding 0.1 to 10 BTC) and shrimp (wallets holding up to 1 BTC) also scoop up Bitcoin whenever they have a chance. Glassnode data show that crabs are buying Bitcoin at the fastest pace observed since 2017.
However, the miner has another story. For them, higher energy costs and lower profitability in the mining business further complicated the problem. In June 2022, Glassnode shared the “Bitcoin Pure Multiple Chart” to evaluate the profitability of Bitcoin mining.
The chart showed that profitability fell to the lowest observed level since November 2018, above the lowest observed level during the crackdown on COVID-19 and Chinese cryptocurrencies.
In addition, lower Bitcoin prices undermine the value of hard-earned rewards and cast doubt on business sustainability. The miner currently owns a total of approximately 65,200 BTC. Due to the fear of further price decapitation, miners are reducing the load on the open market by about 3,000 to 4,000 BTC each month.
Experts and chart patterns can provide insights on where Bitcoin prices go from here, but no one can be sure. All we can do is wait and watch.
