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Bitcoin (BTC) continues to show strong momentum even after a major rally. Key data shows that the upward trend has likely been fueled by smart money in recent months. This means that retail or traditional investors have largely been on the sidelines as BTC’s price surpassed $ 15,000 this month.
In 2017, when Bitcoin’s price hit an all-time high at $ 20,000, retail demand was at its peak. Google Trends data has shot up, traditional media coverage has dramatically increased, and spot trading volumes have exploded in major markets, most notably South Korea and Japan.
This time around, Google Trends interest is relatively low on the ‘Bitcoin’ keyword, while data on the chain shows that smart money is hoarding BTC.
High net worth investors are buying Bitcoin
Furthermore, it was mostly high net worth investors who bought Bitcoin, according to chain analyst Willy Woo.
When whales buy Bitcoin, they primarily facilitate deals through the over-the-counter (OTC) market. Over time, spot and derivative markets follow the OTC market as whales lead the upsurge. Court She said:
“Who bought this rally? It’s smart money … High net worth individuals. You can see the average value of trades between investors taking a big leap to the top. OTC banks are seeing it too. Bitcoin is still in its stealth phase of its bull run. “
The whale trend driving retail investors is optimistic because it shows that Bitcoin is still in its nascent bullish phase. Large capital from new retail and traditional investors have yet to enter the cryptocurrency market.
Another metric Glassnode paints a similar trend. The number of Bitcoin addresses holding more than 100 BTC hit a seven-month high at 16,271.
New money is coming
The whales that have been buying Bitcoin consistently over the past few months are optimistic themselves. But Woo pointed out that the number of new whales has also increased.
If the number of addresses containing large amounts of Bitcoin increases, analysts see it as an overall spike in new whales.
The rise of more high net worth individuals hoarding Bitcoin coincides with the start of the recent institutional frenzy around BTC.
After Square’s purchase of BTC for $ 50 million, the number of high net worth investors in the Bitcoin market has significantly increased. Woo explained:
“Best of all, we’re not only seeing smart money flow, it’s NEW smart money. The orange line is the rate of new investors entering one hour previously unseen on the blockchain. It is seriously bullish. “
Google Trends data shows relatively low retail interest
Google Trends data points to a narrative similar to that of data points in the chain. The search volume for the ‘Bitcoin’ keyword is currently less than 10% from its 2017 high.
However, while the search volume for Bitcoin remains low, there is particularly high interest coming from states like Hawaii, California, Nevada, and Washington.
Interestingly, California and Hawaii rank as the third and fourth highest per capita income per state in 2020.
Furthermore, San Jose / San Francisco in California, aka Silicon Valley, is ranked as the best metropolitan region for Bitcoin’s interest. Silicon Valley is, of course, home to many high net worth investors and entrepreneurs.
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