- Institutional demand is back and recently pushed back to post-Terra LUNA and FTX collapse levels.
- HODLing intensifies but still highlights room for improvement, as well as short-term profit-taking.
Long-term expectations have crept back into Bitcoin [BTC] investor sentiments in the last few weeks. This could partly be the reason for the recent bullish activity and surprisingly, whales have not been left behind.
How many are 1,10,100 BTCs worth today
Now that Bitcoin’s long-term prospects seem more bullish, the demand for the cryptocurrency leveled up. New data suggested that traders could see more upside in the coming weeks as institutional demand makes a comeback.
An IntoTheBlock analysis reveals that institutional demand for BTC is has been growing and recently achieved a new 2023 high. This is evident by the surge in the number of transactions worth over $100,000.
Institutional interest in Bitcoin is clearly heating up. Transactions over $100k have reached new 2023 highs. Recent spot ETF applications seem to be a driving force, as was the case after BlackRock’s ETF filing in June. pic.twitter.com/8dAgQ8Mfpo
— IntoTheBlock (@intotheblock) October 27, 2023
Evaluating the state of Bitcoin HODLing
Analysts believe that this new-found institutional demand was likely the result of excitement around Bitcoin ETFs. The return of institutional demand coincides with recent on-chain observations.
Take for example the amount held by the largest BTC addresses. Addressees holding at least 100,000 BTC and those holding over 1 million BTC have been aggressively accumulating Bitcoin in the last two weeks.
Source: Glassnode
In fact, the recent accumulation of whales could be considered noteworthy because the same whale address balances were back above May 2022 levels. This was important because May and June of the same year (2022) saw robust outflows due to the Terra LUNA and FTX collapse and the subsequent FUD.
The intensity of the spike in whale and institutional demand observed in the last two weeks was last observed in January 2023. Furthermore, looking at BTC’s Open Interest (OI) from the derivatives segment, it was clear that negative funding rates have been declining in the last few weeks.
Source: Hyblock Capital
Positive OI prevailed especially in the last few weeks as a result of the rising bullish sentiment. However, the same data revealed that BTC’s OI still had some room before reaching the highest levels observed in the last 12 months.
Read about Bitcoin’s price prediction for 2024
The growing demand for BTC and the shift in favor of a long-term outlook resulted in more HODLing. The BTC HODLed or lost coins metric recently peaked at its highest level since the start of 2023.
Source: Glassnode
We also observed positive growth in Bitcoin miner balances on a YTD basis, which aligned with the return of confidence. However, outflows from miner balances in the last few days could point toward short-term profit-taking.
Nevertheless, most metrics above highlighted the fact that Bitcoin demand has been growing gradually. This means its future is shaping up for a healthier long-term bullish outlook.