Investors usually dread a correction on any financial market as most of them lose their funds and sometimes even face liquidation. But while others count their losses, large players or whales start to accumulate, increasing their positions with discounts.
Bitcoin enters accumulation phase
IntoTheBlock analysts have highlighted increased volumes on addresses that are already holding over 1,000 BTC. Elevated volumes on large Bitcoin addresses are usually tied to two things: high spending rates and accumulation.
Since addresses are not losing their worth due to moving funds on exchange addresses, and the number of coins in their wallets are increasing, it could indicate that whales are in fact accumulating rather than capitulating.
During the previous correction, the activity of wallets that hold more than 1,000 Bitcoins on their addresses has increased in a similar way. Whales tend to step up during bear trends on markets. By buying assets at a discount, it allows them to redistribute their holdings with greater profits when the ascending movement takes place.
Bitcoin's market performance
While the buying activity on whale-tier addresses intensifies, Bitcoin is not rushing to recover almost 20% of its value lost previously, and it goes down even further, reaching $40,000.
Previously, due to instability in the mining industry due to political demonstrations in Kazakhstan and the first signs of the strengthening of U.S. monetary policy by the Fed, Bitcoin has plunged by more than 18% in less than two weeks. The majority of assets on the cryptocurrency market have become oversold, according to technical indicators like the Relative Strength Index.