Is a Rally Imminent? (CryptoQuant)

The crypto market is recording a surge in bitcoin (BTC) inflows to whale wallets, indicating that this cohort of investors has begun to accumulate the digital asset again amid the recent downturn.

Analysts at the market intelligence platform CryptoQuant see a substantial inflow of BTC into whale addresses as the act of storing BTC in custody wallets after over-the-counter (OTC) purchases. This means the whales that are currently accumulating are likely buying from OTC vendors because institutions prefer to purchase BTC through OTC trading.

Bitcoin Whales Are Accumulating

Whales’ wallets are seeing inflows of more than 22,770 BTC. Considering the effect they have on the Bitcoin market, this period of accumulation could be bullish, and the cryptocurrency could experience a rally soon.

The rise in OTC trades also signals a significant increase in inflows to the Coinbase Prime Brokerage Service because the platform is the preferred BTC purchase channel for institutions in the United States. This also suggests that the Bitcoin market is currently dominated by U.S. institutional investors, with such traders accounting for more than 50% of BTC spot trading market share.

A separate CryptoQuant analysis from earlier this week revealed that U.S. entities, including banks, exchanges, and funds, are increasingly participating in this bull cycle. Their BTC holdings have continued to rise above the percentage of assets held by non-U.S. entities.

Confidence in Bitcoin’s Future

Amid the uptick in whale wallet inflows and U.S. institutional participation, the share of new such investors in the Bitcoin market has been rising. New whales refer to investors holding more than 1,000 BTC with coin ages of less than 155 days. These investors react more to market changes and are actively involved in trading, with their behavior reflecting the phase of the market cycle at any given time.

Over the weekend, CryptoQuant analyst AxelAdlerJr disclosed that the share of new Bitcoin whales had reached 60% of the total realized capitalization of large players. Their growth began when BTC reached $55,000 last year, and since then, their share has risen 43% to its current level.

Since the new whale activity tends to rise during periods of optimism, their current milestone signals confidence in Bitcoin’s potential and future market conditions.