On-chain data shows that bitcoin whales of between 1k and 10k BTC have recently expanded their reserves, a sign that could be bullish for the price of the crypto.
Bitcoin reserves of 1k-10k BTC holders have seen a recent increase
As explained by an analyst in a Cryptoquant post, whales holding between 1k and 10k BTC have shown smart-money behavior in the past as they usually buy near the bottom and sell near the top.
The relevant metric here is the total amount of coins currently being held by the various holder groups in the bitcoin market.
Here the criteria for grouping investors is based on how many coins they have in their wallet. For example, the 100 to 1k BTC cohort includes all holders who have wallet amounts in this range.
Now, below is a chart that shows the trends in the reserves of 100 to 1k BTC and 1k to 10k BTC investor groups over the past year:
It seems like the reserve of the 100 to 1k BTC holders has gone down recently | Source: CryptoQuant
As you can see in this graph, the bitcoin reserves of 1k to 10k BTC whales are showing some interesting movement.
The reserves of this holder group seem to have generally started to decline as the coin price approached any local top.
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Also, the group has similarly timed their purchases around the bottom formation. This means that these investors have been acting like smart money in the last one and a half years.
Recently, the reserves of this investor group have seen a sharp increase over the past few weeks, indicating that they are buying. If the historical trend is anything to go by, such a signal could be bullish for the price of the crypto.
However, 100 to 1k BTC holders have shown the opposite behavior compared to these smart-money investors.
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These holders usually buy as the price moves up and sell during the downtrend. Recently their reserves have also decreased, indicating that they are selling while 1k to 10k BTC whales have bought.
However, there may be another way to look at it. The reason why the 100 to 1k BTC group goes down may be that some holders buy enough to buy more than 1k BTC, making them now part of the 1k to 10k BTC group instead.
At the time of writing, bitcoin is priced around $31.3k, up 2% over the past week.
Looks like the price of the crypto has shot up over the past 24 hours | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com