Whales have been acquiring substantial amounts of Bitcoin (BTC) leading up to the upcoming halving event. As the fourth Bitcoin halving approaches, which will reduce the block reward to 3.125 BTC, the increased demand from whales suggests a bullish market sentiment.
Data from crypto analytics firm CryptoQuant reveals that the demand from Bitcoin whales is at an all-time high. In fact, the demand from “permanent holders” has surpassed the market supply of new Bitcoin for the first time. This indicates that the amount of new Bitcoin generated through mining is insufficient to meet the demand from cryptocurrency investors. This scarcity will only increase after the halving event.
The growing demand from BTC whales, coupled with the influx of spot Bitcoin, will exert upward pressure on the price of the leading cryptocurrency. In the medium to long term, this trend could potentially drive the value of Bitcoin even higher.
The Bitcoin halving is a significant event in the crypto ecosystem and is often accompanied by euphoric price movements. Historically, each bull run has started months before the halving as anticipation builds around the reduced supply of BTC. After the halving, the price of BTC typically experiences a substantial increase due to the decreased supply and the widening supply-demand imbalance.
In addition to its direct impact on supply, BTC halvings also affect miners, who are responsible for verifying transactions and adding new blocks to the blockchain. Each halving cuts the amount of BTC earned by miners in half, which raises the cost of mining new BTC. Therefore, BTC prices must rise to a certain level for miners to remain profitable.
At present, the average cost of mining one Bitcoin is around $49,000, which remains profitable given the current trading price of approximately $70,000. However, post-halving, BTC prices will need to surpass $80,000 for miners to continue operating at a profit.
The accumulation of whales is seen as a positive sign for the crypto market, as it indicates that large BTC holders are moving their assets to cold wallets in anticipation of a price surge.
Magazine: Creating ‘good’ AGI that won’t pose a threat to humanity – Crypto’s Artificial Superintelligence Alliance