Bitcoin (BTC) has surged above $71,000 for the first time since March 15, driven by positive capital flows into spot BTC exchange-traded funds (ETFs). Over the past 24 hours, BTC has risen by more than 0.55% to reach a weekly high of $71,582 on March 26. Several factors are contributing to Bitcoin’s current price movement, including consistent inflows into spot Bitcoin ETFs, the upcoming Bitcoin halving event, and overall positive sentiment among institutional investors.
One factor behind Bitcoin’s rally is the accumulation of BTC by large investors who anticipate future price increases. Data from market intelligence firm Santiment shows that the percentage of wallets holding between 1,000 BTC and 10,000 BTC has increased from 23% on January 1 to 25.17% on March 26. Similarly, the percentage of wallets holding between 10,000 BTC and 100,000 BTC has seen a sharp spike from 11.68% on March 2 to 12.42% on March 21, before dropping slightly to 11.98%.
This whale accumulation of Bitcoin is supported by a decrease in BTC deposits on exchanges. According to Glassnode data, the number of deposit transactions to known exchange wallets has been declining since March 5, despite the price of BTC climbing above $69,000. This decline in deposits suggests a lack of intent to sell, which is generally seen as a bullish sign. In addition, there has been an increase in the number of whales transferring Bitcoin from exchanges to self-custody wallets, indicating a long-term holding strategy.
The upcoming Bitcoin halving event, set for April this year, is also contributing to the increase in Bitcoin’s price. Market data provider Glassnode suggests that the significant buying power of ETFs will overshadow the traditional supply squeeze effect expected from the halving. The supply dynamics of Bitcoin are increasingly influenced by the actions of long-term holders (LTHs), and their decisions to sell or hold can significantly impact market liquidity and sentiment.
As the halving event approaches, investors are positioning themselves for the event. Bitcoin traders and analysts are now focusing on the next level for BTC after its rally above $70,000. Whales have added more than 80,000 BTC when the price dropped to $64,000, indicating strong support at that level. Traders are determined to hold the price above $70,000, with some analysts predicting a further rise to $100,000.
Please note that this article does not provide investment advice or recommendations, and readers should conduct their own research before making any investment decisions.