CRYPTO MOVERS AND PRICES
Crypto was mixed earlier this morning with both Ethereum (ETH) and bitcoin (BTC) making new record highs overnight. The Purpose BTC ETF (BTCC.U) began trading on the Toronto Stock Exchange this morning.
Crypto Story of the Day
The number of BTC addresses holding over 1,000 BTC reached a record high of 2,488 on February 7, marking a sharp increase that began at the end of December.
The number of addresses holding over 1,000 BTC began increasing in August 2018 and continued to do so over the past 3 years. However, the jump in addresses since the end of December marks the largest increase in the metric in a span of about 7 weeks. Since the price of BTC broke out above USD 20,000 in mid-December, this metric has increased by 7.96%.
At the same time, addresses holding over 10,000 BTC have fallen to 98, lows previously seen in January 2015 and December 2018. These addresses, associated with the early BTC investors and miners, peaked at 126 in October 2018 ahead of a protracted bear market that spanned the winter of 2018 and 2019. This pattern, in which addresses with over 1,000 BTC have risen while addresses with over 10,000 have fallen, is also accompanied by diminishing exchange balances.
At an all-time high achieved in February 2020, 16.51% of outstanding BTC was held by major venues while that figure has since fallen to 12.62%. This pattern has been most pronounced with Coinbase, which has seen net 192,510.54 BTC leave its wallets since February 2020.
While the institutional adoption of BTC has been most obvious via headlines and filings made with the SEC, blockchain data also supports the thesis that the asset is maturing.
First, the diminishing share of BTC on major trade venues, in part, suggests the coin’s usage is shifting away from retail-focused trading venues. Second, the increasing number of addresses holding over 1,000 BTC alongside the dropping number of addresses with over 10,000, reflects the increasing dollar-value of BTC. This may also be because of the coin’s distribution from early pioneering participants to seemingly more recent entrants over the last 2 years.
Furthermore, the risk of concentrated BTC positions in single wallets has increased: 43 of the 98 addresses with over 10,000 BTC have a USD balance greater than 1 billion based on current prices. Ultimately, in spite of the “HODL” culture surrounding BTC and crypto, on-chain metrics suggest that some whales have likely been tempted into sales.