Inauguration Effect? Bitcoin Whales Start Accumulating As Trump Era Begins

Ash Tiwari

4 months ago

3 mins read

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Following Donald Trump’s inauguration on January 20th, Bitcoin (BTC) has remained range-bound, trading between $101,000 to $110,000. However, a new report by CryptoQuant states that behind this routine price action, Bitcoin ‘whales’ are quietly back to accumulating the premier cryptocurrency.

Bitcoin Whales Back In Accumulation Mode

According to the report, large BTC holders – commonly referred to as Bitcoin ‘whales’ – have re-entered the accumulation phase. Recent data shows a significant uptick in the monthly percentage growth of BTC holdings among these large investors.

Notably, Bitcoin whale holdings increased from a decline of -0.25% on January 14 to a growth of 2% by January 17, marking the highest monthly growth rate since mid-December. In absolute terms, these investors’ BTC holdings rose from 16.2 million on November 4 to 16.4 million as of January 24.

The surge in whale accumulation appears to be driven by several bullish developments early in Trump’s administration. For example, the US president has already signed an executive order establishing a Working Group on Digital Asset Markets.

This Working Group has been tasked with proposing a federal regulatory framework for cryptocurrencies – including stablecoins – within six months. Additionally, the group will evaluate the potential creation of a national digital asset stockpile, fueling speculation about a potential US strategic Bitcoin reserve.

Besides growth in whale holdings, selling pressure for BTC has declined sharply since major profit-taking in December. This aligns with a recent report which found that BTC profit-taking has dropped by 93% from its December peak. The report reads:

Bitcoin holders realized daily profits as high as $10 billion as Bitcoin approached $100K in December. However, daily realized profits have fallen to levels around $2-$3 billion in January, which indicates market participants may have finished selling Bitcoin for the most part. Moreover, the traders’ unrealized profit margins have declined near zero, a level which typically marks a price floor during bull markets.

However, the report also highlights that overall Bitcoin spot demand has weakened over the past month, raising concerns about the likelihood of another bullish rally. Specifically, the rate of demand growth for Bitcoin has fallen from 279,000 BTC in early December to just 75,000 BTC at the time of writing.

Analysts Confident Of Another BTC Rally

Despite the cooling of on-chain demand, crypto analysts remain optimistic about another major price rally for Bitcoin. For instance, a recent report suggested that BTC could target a price as high as $249,000 during Trump’s presidency.

Another report by Bitfinex predicted that BTC is likely headed to $200,000 by mid-year amid mild price pullbacks. However, a lot depends on how the US Federal Reserve handles interest rate adjustments this year.

From a technical standpoint, BTC’s cup-and-handle pattern projects a price target of as high as $275,000. At press time, BTC trades at $106,074, up 0.1% in the past 24 hours.

Featured image from Unsplash, Chart from TradingView.com

Ash Tiwari

Ash is a dedicated crypto researcher and blockchain enthusiast with a passion for diving deep into the evolving world of decentralized technologies. With a background in writing and a natural curiosity for how digital assets are shaping the future, he has immersed himself in various sectors of the cryptocurrency space, including decentralized finance (DeFi), NFTs, and liquidity mining. His journey into crypto started with a desire to fully understand the technology behind it, leading him to explore and engage with these systems firsthand.

Ash’s approach to DeFi goes beyond surface-level research as he actively participates in decentralized protocols, testing their functionality to gain a deeper understanding of how they operate. From experimenting with staking mechanisms to exploring liquidity mining strategies, he is hands-on in his exploration, which allows him to provide practical, real-world insights that go far beyond theoretical knowledge. This immersive experience has helped him develop a comprehensive grasp of smart contracts, token governance, and the broader implications of decentralized platforms on the future of finance.

In the NFT space, Ash’s interest is driven by the technology’s potential to reshape ownership and creativity in the digital age. He has explored various NFT projects, gaining insights into how these digital assets function within different ecosystems. His focus is on understanding the evolving relationship between creators and communities, as well as the innovative uses of blockchain technology to establish authenticity and provenance in the digital world. Ash’s research in this area often touches on the intersection of culture, technology, and community-driven projects.

A key area of his expertise lies in liquidity mining, where he has engaged with various decentralized platforms to understand how liquidity provision contributes to the functionality and security of DeFi ecosystems. Ash’s hands-on involvement has allowed him to analyze the risks, rewards, and broader implications of liquidity pools, giving him a well-rounded perspective on this integral part of DeFi. His understanding of risk management and protocol design allows him to provide insights into how these systems can be navigated effectively, with an emphasis on both opportunity and caution.

When it comes to communicating these complex topics, Ash’s writing is grounded in clarity and depth. He excels at breaking down intricate blockchain concepts into easily digestible information for a wide audience. Whether explaining the workings of decentralized exchanges or outlining the future potential of blockchain technology, Ash ensures that his content is accessible to both those new to the space and experienced participants looking for deeper insights.

Beyond DeFi and NFTs, Ash explores a wide array of emerging blockchain applications. His research spans areas like cross-chain technologies, decentralized governance, and blockchain’s potential to integrate with traditional finance. He is continuously learning and adapting to the latest developments, ensuring that his insights are both timely and relevant. His interest extends to how these technologies are creating new possibilities for decentralization, transparency, and trust in a variety of industries.

Ash’s commitment to engaging with the crypto space firsthand gives him a unique perspective that goes beyond what can be learned from research alone. His practical involvement allows him to stay ahead of the curve, offering readers and enthusiasts a clear and comprehensive understanding of the rapidly evolving world of blockchain. Whether delving into the technical mechanics of DeFi or exploring the cultural impact of NFTs, Ash’s approach is always rooted in curiosity, research, and a desire to make this technology accessible to all.

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