Bitcoin newsCrypto Analysis

Whales Selling, Institutions Buying, is this a Paradigm Shift in Bitcoin?



The so-called Bitcoin “Sell Wall” below $20k has so far failed to reverse the tide. The cryptocurrency’s price index has so far loitered around the figure and doesn’t appear to lose steam. It may even surpass the all-time high figure one day and never look back. Even when majority outlets are reporting whales going on a selling spree, the price still manages to bounce back to the $19k+ levels. The answer is simple; institutional buying.

Grayscale Adds 7,188 BTC in the last 24 Hours

Grayscale, the world’s largest Bitcoin institutionalized investor is showing no signs of slowing down its Bitcoin purchasing spree. The fund has bought a whopping 7,188 BTC during the last 24 hours alone worth $136.5 million. We are seeing this rare buying spree from a Bitcoin investment fund despite whole schools of big Bitcoin holders aka whales selling their crypto off/shorting around the $19k level.

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Navigating through Unchartered Territory against Whales

Now this is extremely unprecedented in the cryptocurrency world. Normally, the whales are so powerful that their behaviour dictates the market price and overwhelms other market forces. No matter how much users HODLed, the whales had their way and could easily manipulate the market. However, this time around, it seems that they have met their match. Grayscale is a Bitcoin institutionalized investor and has taken big investments from the public who want to get into Bitcoin through a conventional player.

Now whales are selling and selling big between the $18.5k and $19.5 level. Tens of thousands of Bitcoin have already been liquidated but the price has been relatively stable. How is it that these billions of dollars worth of Bitcoin are being sold and the market is not going down? The answer is; Grayscale. Grayscale is buying and it is buying big. According to the company’s communiques, it has bought more Bitcoin in November than the amount minted by miners during the timeframe, twice in fact.  It is also soaking up the selling pressure from the whales. So, what is happening is that whales are selling profusely but Grayscale is keeping on buying and buying. As a result, the price index is remaining relatively stable.

What will happen?

Either Grayscale or the traditional whales will come out of this tussle as the winner. If whales run out of Bitcoin to liquidate, the price index is going to rise sharply the whales will give in to FOMO and buy again. If Grayscale runs out of funds, a significant price decrease might be witnessed leaving Grayscale vulnerable. However, Grayscale seems to be winning at the moment and is showing no signs of slowing down. It is interesting to see where this struggle will go.

Image source: Hans Dekker

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