Last week, Bitcoin showed a fairly high volatility, that is, the price of the cryptocurrency was changing at a very high speed. However, even such market changes did not frighten off large investors of the planet’s main digital asset.
On the contrary, they continue to actively buy BTC. This is evidenced by data from a recent study of the Glassnode analytical platform. We tell you more about it and at the same time share other details.
Bitcoin started the new week positively. The main cryptocurrency has a 2% increase in value over the past 24 hours, thanks to which the rate is $ 33,220 this morning. At the same time, as we have already noted, the price rally has slowed down recently. BTC set a price record of $ 41,940 on January 8, after which there were no attempts to overcome this level.
As a result, the current performance of Bitcoin’s price behavior is far from the activity at the end of last year. In particular, in two weeks, the value of BTC fell by 13.5 percent. Here is a graph of the cryptocurrency rate for a month.
Who buys Bitcoin
According to Glassnode, the number of large crypto wallets with at least 1,000 bitcoins on their balance continued to rise in the previous week. This means that serious investors who are investing millions of dollars in cryptocurrency are not afraid of the recent sinking of the coin’s rate and the current pause in its growth. On the contrary, the amount of funds in their wallets has grown – and this indicates confidence in the digital asset and new purchases.
In addition, according to the South Korean analytical company CryptoQuant, the number of BTC transactions on the network remains high. However, the ratio of bitcoin transfers from exchanges to all other transactions across the network has not increased. That is, most of the transactions were made through OTC trades, which is the preferred approach for institutional – that is, large – investors.
As a reminder, OTC trades are also called OTC trades. They are understood as operations with cryptocurrencies, which the interested parties carry out personally. One person brings a carrier with a key to the cryptocurrency address, while the other takes money – most often cash. Read more about the features and benefits of OTC transactions in a separate article.
Here’s a quote from Ki Yong Joon, CEO of CryptoQuant. The replica is provided by Coindesk.
Only 7 percent of transactions are used to exchange deposits and withdrawals. 93 percent of transactions on the Bitcoin network are used for non-exchange transactions – such as OTC trades.
In other words, large investors continue to buy Bitcoin, and the recent cryptocurrency crash did not deter them in any way. Most likely, they perceive this pullback in the BTC price just as a profitable opportunity to accumulate as many coins as possible. And this cannot but rejoice – the more coins companies buy, the higher their deficit in the market and, consequently, their value.
In addition, for now, the decision to buy cryptocurrencies during downturns does not seem too dangerous. Still, the current active stage of Bitcoin growth began only a few months ago, which means there is still time before the end of the race. Accordingly, while buying an asset while its value is falling should really bring a quick profit.
And now about big purchases. If you have been following the market over the past few months, then you should be aware of the tactics of MicroStrategy, which has been actively buying bitcoins all this time. Even its CEO Michael Sailor makes huge personal investments in BTC.
So: during the recent drawdown of the BTC rate, representatives of MicroStrategy purchased another batch of bitcoins for $ 10 million, Decrypt reports. At the same time, the total value of MicroStrategy’s digital assets in dollar terms already exceeds the $ 2.3 billion mark.
MicroStrategy currently has a total of 70,784 bitcoins on its account. According to the firm’s documents, the average cryptocurrency purchase price is $ 16,035 per coin. This is higher than it used to be because the firm was buying new coins at much higher prices than in previous rounds of cryptocurrency investments.
Be that as it may, the company’s management remains true to its principles and continues to replenish the stocks of bitcoins. In addition, they take advantage of market downside moments, thus setting an example for less experienced investors.
We believe that this behavior of investors is positive and testifies to the confidence of large players in the potential of cryptocurrencies. They are not only not afraid of short-term drops in value, but they also use them to replenish their Bitcoin stocks, thanks to which their profits will be even greater in the long term.
It’s hard to find reasons not to follow this strategy. However, it is important to note that for this, the investor must understand the basics of blockchain operation, the security of cryptocurrencies and other important details. In which case, the Cryptocurrency Bible will acquaint you with the basics of the industry. It provides materials on basic topics for beginners.