The price of Bitcoin surpassed USD 38,000 after Elon Musk said that Tesla could accept it again. Willy Woo said Bitcoin whales comprise 26% of the supply, but the wealthiest whales are barely 3.75% and are declining.
The price of Bitcoin fell below USD 30,000 on July 20th, a level not seen since June. That coincided with the release of 24,000 BTC for the unlocking of shares in Grayscale Bitcoin Trust.
The next day was positive for Bitcoin as it rallied by 8%, going from USD 29,800 to USD 32,181.
Cathie Wood of Ark Invest, Elon Musk of Tesla and SpaceX, and Jack Dorsey, CEO of Twitter and Square, recently spoke about the pioneering cryptocurrency. Musk said that Tesla could accept Bitcoin again, while Wood highlighted that it is the most efficient vehicle for receiving remittances in emerging countries. Dorsey recalled that Bitcoin is open since its inception and has become a solid Internet standard currency that everyone can use.
The comments from these renowned figures could have caused the increase in the price of BTC. The cryptocurrency is currently trading at around USD 39,090, an appreciation of more than 9.6% since July 19th.
The Number of Bitcoin Whales Is Dropping
Bitcoin whales, who hold more than 1,000 BTC, comprise 26% of the supply of the cryptocurrency. However, the wealthiest, who own more than 10,000 BTC, barely have 3.75% and are declining. Analyst Willy Woo provided that information in a recent longitudinal study on Bitcoin supply.
Woo notes that the minnows, who own less than 10 BTC, have 13% of the supply, half of what the whales accumulate. However, he argues that the amount they control also represents small users when including exchanges. That would lead the school of small fish to reach 30%, evidencing a wider distribution of the supply.
The Stock-to-Flow Model Applied to Bitcoin Stumbles
The stock-to-flow model applied to the prediction of the price of Bitcoin began to lose its validity since the correction in mid-April.
The model indicates that the price of BTC should be close to USD 80,000. The model only takes into account the supply of Bitcoin and the issuance of new coins. However, some external factors have a direct impact on the price.
Bullish Metrics Indicate that Bitcoin Outflows Increase
The number of entities receiving BTC on exchanges is on the rise, on-chain data analytics firm Glassnode notes. However, those that predominantly deliver BTC are on the decline.
In a study by this firm, the net flows of Bitcoin on exchanges have reverted to outflows. Those platforms are currently posting net outflows of 36,300 BTC per month, says Glassnode.
The Peak in the Number of Users Increases in the Last Cycle
The number of users on the Bitcoin network has steadily grown in this bullish cycle amid the correction. On-chain data analyst Will Clemente compared user growth between two successive bullish cycles.
The peaks between 2011 and 2013 went from 1,819 to 5,488 users, an increase of 152%. Meanwhile, between 2013 and 2017, there has been a 646% increase in users. Many analysts consider the peak of this cycle has not yet occurred, so Clemente wonders about its future growth.
By Alexander Salazar
