CryptoQuant CEO Ki Young-Ju today pointed out significant similarities in Bitcoin market behavior between the current situation and mid-2020, a period characterized by stagnant prices but high on-chain activity. Young-Ju’s insights were illustrated with two key graphs and shared via a post on
The first chart, which shows data up to 2020, shows the price of Bitcoin next to the realized limit for new whales – a metric that tracks the total value at which the newly acquired Bitcoin was last moved by major investors. It is another form of market capitalization where each UTXO is assessed at the price it last changed hands at, rather than the current market price. This metric reflects the actual realized value of all coins in the network, rather than their current market value.
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This value saw a sharp increase around mid-2020, right when the price of Bitcoin was caught by boredom as it had been in recent months and consistently traded around $10,000. According to Young-Ju, this period was marked by high on-chain activity, which later analysis suggested involved over-the-counter (OTC) transactions between institutional players.
In the second chart, which extends to 2024, a similar pattern emerges with even more pronounced growth in the realized limit for new whales, despite Bitcoin’s price having been moving sideways for almost 100 days now. The chart indicates a significant addition of about $1 billion per day in new whale portfolios, a term that typically refers to addresses holding large amounts of Bitcoin, often linked to institutional or highly capitalized individual investors.
What this means for the Bitcoin price
Ki Young-Ju explained these observations: “Same vibe on Bitcoin as mid-2020. At that time, BTC hovered around $10,000 for 6 months, with high on-chain activity, later revealed as OTC deals. Despite low price volatility, activity in the chain now remains high, with $1 billion added daily to new whale portfolios, likely in custody.”
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He further pointed to a September 2020 tweet that confirmed his analysis, noting that “the number of BTCs transferred is at a high of the year, and those TXs are not coming from exchanges. The Fund Flow Ratio of all stock exchanges reaches the lowest point of the year. Something’s happening. Possibly OTC deals.”
This comparison and the continued high level of the realized cap for new whales indicate a continued accumulation phase among large-scale investors, reminiscent of the activity observed in mid-2020. Such moves are generally not visible on traditional crypto exchanges and indicate strong institutional interest that could be a precursor to significant market moves. After Young-Ju’s tweet, the BTC price increased by 480% from September 2020 to November 2021.
Whether a similar move occurs for the Bitcoin price remains to be seen, but the continued growth of Bitcoin ownership among new whales, along with persistent price levels, points to a possible build-up of pressure beneath the apparent calm of the market surface. As has been observed in the past, such conditions can lead to substantial price movements once the accumulated Bitcoin begins to impact the broader market via either increased liquidity or renewed trading interest.
At the time of writing, BTC was trading at $68,271.
Featured image created with DALL·E, chart from TradingView.com