Whales Buy, Early Birds Sell: Bitcoin's Split Market

Bitcoin is currently trading around $70,500 after failing to sustain a push towards $75,000 following a recent Federal Reserve announcement. The market dynamics reveal a divergence, with long-time investors divesting while significant whale wallets are actively accumulating.

In recent weeks, two early Bitcoin holders divested a combined total of $117 million. One wallet, which acquired 5,000 BTC over a decade ago, sold 3,500 BTC for substantial profit, retaining 1,500 BTC. Another early investor fully closed out tracked positions, moving approximately 11,650 BTC worth $1.16 billion over five months.

However, substantial buying from whale wallets has helped Bitcoin maintain its position above $70,000. Addresses holding over 1,000 BTC added 8,400 coins within 48 hours of the Fed decision. Overall, large holders have accumulated 270,000 BTC in the past 30 days, marking the most significant monthly increase since 2013.

Concurrently, Bitcoin supply on exchanges has dwindled to 2.7 million BTC, the lowest point since 2018. This reduction is attributed to coins moving into cold storage, ETFs, and corporate treasuries. Spot Bitcoin ETFs experienced seven consecutive days of inflows totaling $1.17 billion between March 9 and March 17, though a $129 million outflow was recorded on March 18.

Market sentiment remains deeply cautious, with the Fear & Greed Index stuck in extreme fear territory for 46 consecutive days, currently at 11. Historically, similar sentiment levels preceded major downturns, yet often led to substantial gains over time. Bitcoin's weekly RSI has also dropped below 30 for only the third time in its history, a level that previously marked the beginning of long-term bull runs.