Bitcoin and Ethereum whales are taking advantage of a market-wide downturn, increasing their holdings as the leading cryptocurrencies trade at discounted prices.
Market Trends
Bitcoin fell 1.4% in the last 24 hours, trading at $97,300 as of this writing, down from its all-time high of $103,700 reached last week. Ethereum, similarly, dropped 3.3% to $3,750 after briefly surpassing $4,000 on December 6, a level not seen in nine months.
The decline in prices has spurred increased activity among large holders. According to analytics platform IntoTheBlock (ITB), Bitcoin whales registered a net inflow of 1,900 BTC on Monday, reversing a consistent outflow trend since December 5. Transactions worth at least $100,000 surged by 116%, amounting to $93 billion in trading volume.
Ethereum whales mirrored this behavior, with net inflows of 61,000 ETH on December 9. Large Ethereum transactions jumped 127% to $10.9 billion, coinciding with the asset’s price dip.
Whale Activity’s Ripple Effect
The sudden surge in whale transactions could spark fear of missing out (FOMO) among retail investors, potentially driving prices back up. ITB data further reveals over $200 million in USDT entered centralized exchanges on December 9, a signal of investors preparing to buy Bitcoin and altcoins. Historically, such stablecoin inflows precede bullish movements in the crypto market.
Market Outlook
Despite the increased activity, the global crypto market cap has dropped 6% in the past 24 hours to $3.65 trillion, according to CoinGecko. Daily trading volume, however, surged from $247 billion to $475 billion, reflecting heightened market activity.
The downturn is largely attributed to macroeconomic factors, including anticipation of the U.S. Consumer Price Index (CPI) release and the upcoming Federal Open Market Committee (FOMC) meeting on December 17-18. These events could significantly influence market sentiment.
Should the CPI data and FOMC outcomes suggest a favorable economic environment, the crypto market might experience another wave of upward momentum. For now, whale accumulation and market dynamics hint at a possible rebound in the near term.
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