Another Bitcoin Rally Coming Soon? This Model Can Say So

On-chain data shows a pattern in stablecoin shark and whale assets, which may suggest that the Bitcoin rally may make a comeback in the near future.
Stablecoin Sharks and Whales Have Been Accumulating Lately
According to data from on-chain analytics firm Santiment, while Bitcoin has been struggling lately, the sharks and whales of major stablecoins are increasing their reserves.
"Sharks" and "whales" are two of the largest groups in the industry; Investors of the former hold a minimum of $100,000 and a maximum of $1 million in assets, while the latter have wallet balances of between $1 million and $10. million range.
Because of such large holdings, these investors can potentially move large numbers of coins at once, making them effective assets in the market.
In the context of the current discussion, the sharks and whales of stablecoins are of interest. Especially important here are the four biggest players in the market: Tether (USDT), USD Coin (USDC), BNB USD (BUSD) and Dai (DAI).
Santiment used the “Supply Distribution” metric to track the holdings of these huge holders, and this indicator tells us the percentage of supply that each group in the market currently holds.
Here is a chart showing the trend in this metric for sharks and whales from the top 4 stablecoins in the industry:
As the chart above shows, the holdings of these stablecoin sharks and whales have been increasing lately. Interestingly, while this trend was forming, Bitcoin price dropped below the $30,000 level.
A similar pattern occurred last month in the supply held by these large investors, as these investors bought more stablecoins as BTC fell.
What followed this period of accumulation at the time was a sharp Bitcoin rally that pushed the price of the cryptocurrency above the $30,000 level.
An explanation for this interesting trend could be in what the holdings of these large stablecoin holders mean. Generally, these investors prefer stables when they want to exit volatile assets like BTC.
However, such holders often seek to take shelter in these dollar-linked tokens only temporarily, as they would have exited by other means, such as fiat money, had they wanted to stay out of the industry for a long time.
Thus, these investors would eventually shift their stablecoins back to Bitcoin and others, resulting in a bullish increase in their price with this exchange. Therefore, the supply of these sharks and whales can be viewed as the current buying pressure that these huge investors can put into the asset at any point they wish.
From the chart, it appears that BTC's rally above $30,000 actually started not from new money being pumped back into the asset by sharks and whales, but from the conversions they made back into the asset as their holdings dwindled. rally took place.
Bitcoin is likely to see a bullish effect once again after that, as large investors from the big stables have reaccumulated lately, but it's unclear how long it will take for these investors to re-launch their stablecoins.
Bitcoin Price
At the time of writing, Bitcoin is trading around $29,300, up 1% over the past week.
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