Amid a market correction, bitcoin kits have gained ground in the first cryptocurrency, while large Ethereum addresses continue to hold assets. These are the conclusions reached by analysts at Santiment.
Eyes are on #Bitcoin and #Ethereum as the top assets in #crypto have shown further decline to start the week. Is it #buythedip time yet? $BTC's address activity is at near one-year lows, and $ETH's are as well. Read what our top indicators have to say. https://t.co/dqrxTktzbb pic.twitter.com/caXQkD49BQ— Santiment (@santimentfeed) June 8, 2021
According to the company, the number of bitcoin addresses with balances between 100 BTC and 10,000 BTC has been growing steadily for two and a half weeks.
"The whales seem to be confidently buying on the downside," the analysts concluded.
The NVT indicator indicates a continued bearish sentiment towards the first cryptocurrency. At the same time, onchain activity is declining, with the indicator reaching its lowest level since 27 June 2020 on 5 June.
The supply of digital gold on exchanges is declining after a significant spike in the figure a fortnight ago. Experts see this as a bullish sign - investors are withdrawing assets for safe keeping in non-custodial wallets.
Analysts noted that large Ethereum holders have no intention of closing their positions. The number of addresses holding 1,000-100,000 ETH is virtually unchanged as the asset fluctuates in the $2,000-$2500 range.
"This group of investors is still hanging on to the huge amount of tokens they have been accumulating at a rapid pace since October last year," the experts added.
The NVT indicator for Ethereum indicates bearish investor sentiment for the first time since April 2020. Analysts also recorded a decline in address activity on the second cryptocurrency's network, but not as significant as that of bitcoin.
Ethereum's supply on cryptocurrency exchanges has barely changed during the recent period of volatility. According to experts, many ETH holders have taken a wait-and-see attitude, watching developments around digital gold.
According to journalist Colin Wu, exchange-traded funds from investment firm Purpose Investments have taken advantage of declining cryptocurrency prices to build up positions.
Purpose Bitcoin ETF increased its holdings by 100 bitcoins, with a total holdings of 19508; Purpose Ether ETF increased its holdings by a total of 574, with a total holdings of 54520 ETH. Purpose is the world's first Bitcoin and Ethereum ETF. pic.twitter.com/Gbt4UAeLFy— Wu Blockchain (@WuBlockchain) June 8, 2021
Purpose Bitcoin ETF bought 100 BTC, bringing its holdings to 19,508 BTC. The Purpose Ether ETF bought 574 ETH - it now has 54,520 ETH under management.
Wu noted that Ark Invest's exchange-traded funds are also building up positions. The investment company bought 18,746 units of Grayscale Bitcoin Trust (GBTC) and 13,718 shares of cryptocurrency exchange Coinbase.
APK Ark Fund purchased 18,746 shares of GBTC and 13,718 shares of Coinbase yesterday. ARKW holds 7,441,692 shares of GBTC and 799,779 shares of Coinbase, accounting for 4.01% and 3.37%, respectively; APKK holds 3,134,630 shares of Coinbase, accounting for 3.44%.— Wu Blockchain (@WuBlockchain) June 8, 2021
The ARK Innovation ETF has 7.44 million GBTC units and 799,799 Coinbase shares under management, while the ARK Next Generation Internet ETF holds 3.13 million Coinbase shares.
While some whales are building up positions, other big bitcoin holders - miners - are selling the cryptocurrency. Glassnode analyst William Clemente III pointed out that the balance of digital gold in their wallets has dropped by more than 5,000 BTC in the past week.
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On 8 May, the first cryptocurrency collapsed to $33,000 after a prolonged sideways price movement. As a result, the rest of the market was also in the red.
Find out our professional review on ethereum wallet.