The sideways movement of bitcoin is looking to continue as we are once again in a re-accumulation phase. On-chain whale activity is not showing any improvement, and volatility is getting tighter and tighter in the last few weeks. Just because there is little to no movement by whales- many people believe a bear market is about to kick in.
But by looking at on-chain data, we have realized that the net user growth has not stopped, and the number of entities keeps touching new ATHs. Even one of the top on-chain analysts in the world- Willy Woo- firmly says small bitcoin holders or plebs drive the state of the market. According to Glassnode data, whales sold 4k BTC, and smallholders bought 31k BTC.
Source- Willy Woo
While there is no change in overall whale activity, entities owning 1000-10,000 BTC continue to accumulate as much as possible. We have seen a nice bounce-back recently, but it is not enough to support a change in trend. That is why it is important to watch for new whales entering the market.
Another way to view the market is by considering net entity growth. The price of bitcoin may be in no man’s land, but the bitcoin network growth is hitting all-time highs almost every week. This is another reason why we cannot look at the current state of the market and claim it will be bearish in the future. If the network growth drops and the number of entities collapse suddenly, we can confirm that the bull market has transitioned to bear.
Most people run with an incorrect theory when it comes to key drivers of the market. Whales or institutional investors can only influence the short-term movement of the market, but whenever there is a big bull run, it is always initiated and controlled by smaller entities in the network.
To support the accumulation phase, we can also consider the BTC balance of miners. With the help of on-chain analysis, we can see that miners are adding more bitcoin to their holdings. This is far more promising than we expect because just a few weeks back, most miners relocated to other countries, finding cheap and renewable energy supplies.
In conclusion, on-chain activity shows a strong divergence against bearish price action, and we are getting close to the complete re-absorption of coins. We are more than eight weeks into this re-accumulation phase and could see a breakout anytime soon. The main things to watch for are volatility squeeze, new whales entering the market, and net user growth.

Born and brought up in India, Karthikeya Gutta is a crypto journalist and freelance contributor for ItsBlockchain. He covers various aspects of the industry with in-depth analysis and research. His passion towards blockchain and crypto ecosystem is mainly because he believes it can really change the world and help millions of people.
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