Whales Who Bought BTC in Dec 2018 Hit by $23.8K Rejection8. March 2023
• Glassnode’s latest weekly report shows that all three whale groups went underwater for a while after the FTX crash last year.
• The “realized price” of Bitcoin is used to indicate the average acquisition price in the BTC market, which can also be defined for specific portions of the market like whales who own at least 1000 coins.
• Glassnode has divided whale groups into three subgroups based on different acquisition start points (July 2017, December 2018, and March 2020).
Whales Who Bought Following December 2018 Have Their Cost Basis At $23,800
Data from Glassnode shows that Bitcoin’s latest rejection around the $23,800 level coincided with the cost basis of a particular whale group. According to the latest weekly report from Glassnode, all three whale groups being considered here went underwater for a while after the FTX crash took place last year.
The relevant indicator here is the “realized price,” which is a price derived from the realized cap. This capitalization model for Bitcoin assumes that the actual value of each coin in the circulating supply is not the current BTC price (as the market cap says), but the price at which it was last moved. When this cap is divided by the total number of coins in circulation, the realized price is obtained. The significance of this metric is that it represents the average acquisition price in the BTC market. This means that when the normal price of Bitcoin sinks below this realized price,the average holder goes into a state of loss.
This realized price isthe average cost basisofthe entire market, butthe indicator can also be definedfor specific portionsof themarket. An important cohort for any cryptocurrencyis “whale” group, whichinBTC’s caseincludesallinvestorsholdingatleast1,000coinsintheirwallets. As thistypeof investoris large anddiverse,Glassnodedivideditinto threesubgroups to study themostfavorablerealizedpricesacrossdifferenterasbyusingdifferentacquisitionstartpoints for each: July 2017(Binance launch);December 2018(bearmarketlows);andMarch2020(COVIDbottom). AlsoGlassnodehas only consideredexchangetransactionshere (ascethiscohort usually usestheseplatforms forbuyingandselling).
Bitcoin’slatestrejectionaroundthe$23,800levelcoincidedwiththecostbasiso fa particulargroupof whales whopurchasedfollowingDecember2018havetheircostbasisat$23,800 accordingtothe latestweeklyreportfromGlassnode;allthreewhalegroupsbeingconsideredherewentunderwaterforawhileaftertheFTXcrashtookplacelastyear.
The”realizedprice”indicatorcanhelpidentifywhenholdersaregoingintoalossstate ascomparedto theiraverageacquisitionpricein themarketplace-inspecificthisarticleexplainshowwe can use thistomeasureforthecoinholdingwhalesgroupedaccordingtodifferentstartingdatesformonitoringtheirperformanceagainstcurrentBTCprices