New Report Shows That Crypto Whales And Long-Term Holders Had Their Confidence Shaken By FTX Fall

New Report Shows That Crypto Whales And Long-Term Holders Had Their Confidence Shaken By FTX Fall

November 24, 2022
  • FTX’s implosion may have shaken the faith of long-term Bitcoin holders and whales.
  • This can be seen in exchange outflows, whales underwater and long-term holders spending their assets at new historical highs.
  • Bitcoin currently trades at the $16K mark but the long-term outlook hints at darker days for the asset.

After FTX rocked the digital assets industry with its implosion, Bitcoin (BTC) seemed to have been insulated, but a closer look suggests that hodlers have been stunned by the turn of events.

A Glassnode report notes that as things begin to settle after FTX’s implosion, investor conviction may have been shaken, given the doldrum that accompanied the blackswan event. In arriving at a conclusion, the report scrutinized exchange outflows, whale aggregate positions and the spending habits of long-term holders.

On-chain data indicates that outflows from exchanges are currently at an all-time high of -172K BTC monthly. This figure surpasses the previous high in the sell-off of June 2022, as 77.1K confirmed transactions were related to exchange withdrawals compared to the 48.1K on exchange deposits.

“This burst of exchange related activity pushes the dominance of exchange deposit or withdrawal transactions to 47.4% of the total, the highest level year-to-date.” read the report. “Historically, higher exchange dominance can be associated with bull markets (sustained trends), and high volatility sell-off events (short-term spikes).”

Glassnode suggests that the financial position of BTC whales might have played a role in the increase in average deposit size across all major exchanges. This was the case following Terra’s collapse, and the trend has seen entities holding above 1K BTC see an unrealized loss for the first time since March 2020, given the asset’s current price.

The report noted an uptick in the spending of Bitcoin longer-term holders and that this metric could be key in gauging the impact of the FTX’s collapse on holders.

“The spent BTC volume older than 6-months has also hit the fifth highest value over the last five years. Over 130.6K BTC aged 6-months or more were spent on 17-Nov alone, with the 7-day average now at 50.1K BTC per day,” said Glassnode.

The oddities around BTC in recent times

As BTC’s price consolidates, enthusiasts have cause to cheer following El Salvador’s plan to purchase 1 BTC every day. Tron’s Justin Sun mirrored the move to also announce that TronDAO will be buying one BTC each day as well.

A wallet linked to the BTC-e exchange woke up from the dead after nearly four years as it transferred a total of 10,000 BTC to two unknown addresses on Wednesday.

In New York, the two-year moratorium on Proof-of-Work mining has been signed into law, leaving a sour taste in the mouths of BTC miners in the region. 

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