Bitcoin whales are accumulating assets while Ethereum whales appear to be selling, though the data may be misleading.
Recent data from Glassnode, a leading blockchain analytics firm, reveals a curious divergence between the behaviors of large holders, or “whales,” of Bitcoin (BTC) and Ethereum (ETH). While Bitcoin whales are consistently adding to their holdings, their Ethereum counterparts seem to be doing the opposite—shedding a substantial amount of their investments.
Interestingly, Glassnode’s metrics show that Ethereum whales, specifically those holding at least 1,000 ETH (worth about $1.5 million), have been offloading their assets aggressively since 2020. A massive $20 million in ETH has exited these large accounts, painting a picture of decreasing confidence.
In stark contrast, Bitcoin whales—those with a minimum of 1,000 BTC (approximately valued at $26.9 million)—have been steadily increasing their holdings. Although there were occasional hiccups possibly caused by events like the FTX collapse or post-bull run profit-taking, the overall trend leans bullish.
Are Regulatory Concerns and Technical Complexity at Play?
Swan, a Bitcoin-centric financial service, has observed an influx of high-net-worth individuals looking to swap their Ethereum for Bitcoin. The reason? Regulatory pressures. Ethereum finds itself grappling with a myriad of legal complications, which Bitcoin seems to dodge effortlessly.
Jesse Shrader of Amboss, a data analytics firm that specializes in the Bitcoin Lightning Network, concurs with this view. He points out that Bitcoin serves a straightforward purpose—as a better form of money—while Ethereum’s complexity can sometimes be its downfall. With frequent protocol changes and smart contracts galore, Ethereum seems to be losing focus according to some market experts.
However, the story might not be as straightforward as Glassnode’s data suggests. Kunal Goel, a senior research analyst at Messari, raises an important question—does the analytics account for Ethereum staking? In the Ethereum ecosystem, staking involves locking up at least 32 ETH in a smart contract to validate blockchain transactions. Goel argues that transferring assets to a staking contract may appear as a sale in on-chain analysis but isn’t actually a sale.
Questioning the Data: Is It Really As It Seems?
André Dragosch, Head of Research at Deutsche Digital Assets (DDA), amplifies Goel’s point, going so far as to label the perceived Ethereum whale exodus as a “nothing burger.” He criticizes Glassnode for not including Ethereum held in smart contracts in their whale metrics. Dragosch notes that the percentage of Ethereum’s supply stored in smart contracts has been on an uptick, refuting the notion of a significant decline among large holders.
While it might seem like Bitcoin and Ethereum whales are swimming in opposite directions, a deeper dive into the data suggests that both camps are bullish in their own ways. Regulatory concerns and technical complexities aside, the fact remains that the world of cryptocurrency is as dynamic as ever, and one snapshot may not reveal the entire narrative. Keep your eyes peeled because in the crypto ocean, things can turn on a dime—or should we say, a Satoshi?