Bitcoin Bottoming Phase Was Driven By Large Entities, Glassnode Data Shows

On-chain analytics firm Glassnode has pointed out how large entities drove Bitcoin accumulation during the November-December bottoming phase.

Large Entities Accumulated BTC, While Smaller Investors Sold

In a new post on X, Glassnode has talked about the recent Bitcoin investor behavior. “During the November–December bottoming phase, supply accumulation was primarily driven by larger entities, while smaller cohorts were distributing,” noted Glassnode.

To showcase the trend, the analytics firm has cited the Accumulation Trend Score, an on-chain indicator that tells us about whether BTC addresses are accumulating or distributing. The indicator uses two factors to calculate its value: the balance changes happening in the wallets of the investors and the size of the wallets themselves. This means that larger entities have a stronger influence on the metric.

When the value of the Accumulation Trend Score is greater than 0.5, it means large entities (or alternatively, a large number of small entities) are accumulating. The closer is the indicator to 1.0, the stronger is this behavior. On the other hand, the metric being under the threshold implies that distribution is the dominant behavior among investors. The zero level acts as the extreme point for this side of the scale.

The Accumulation Trend Score can also be separately calculated for specific Bitcoin segments to get a more granular view of behavior. Below is the chart shared by Glassnode, doing exactly this for the various BTC investor groups.

As is visible in the graph, the Bitcoin Accumulation Trend Score was close to a value of 1.0 for 10,000+ BTC investors during the bottoming period that followed the price crash in November. The investors in this wallet range are often dubbed as “mega whales,” corresponding to the largest of entities on the network.

The normal whales, holding coins in the 1,000 to 10,000 BTC range, started accumulating a bit later, as their Accumulation Trend Score turned blue in December. The whales have since maintained net buying, but the mega whales switched to a neutral behavior around mid-December.

Interestingly, while the whales have been showing accumulation, the same hasn’t been true for the smaller investor groups. All cohorts carrying less than 1,000 BTC have displayed varying degrees of distribution during the last few weeks, with the 1 to 10 coins group in particular showing a near-perfect selling behavior.

“This divergence appears to be driven in part by exchange-related wallet reshuffling, and also by large holders buying the dip,” explained the analytics firm. It now remains to be seen how long the distribution from smaller Bitcoin entities will continue.

BTC Price

Bitcoin has been falling since the week started as its price is now trading around $88,900.

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