High Liquidity Whales Controlling Large Funds Open More Short Positions
On the other hand, institutional investors continue to purchase Bitcoin.
Bitcoin [BTC] gained 1.59% last week, but in the past 24 hours, it has taken a different route. In fact, during the aforementioned period, the cryptocurrency nearly lost 3% of its value.
It is worth noting, especially since an analysis by Ambcrypto suggests that this decline could expand further, as hyper-liquid whales control net negative BTC positions in the derivative market. However, this raises an important question—can institutional investors regain ground and reverse the downturn?
High Liquidity Whales Place Major Bets
According to Coinglass, there has been a significant surge in derivative positions on Hyperliquid (a platform that monitors large traders’ positions), with the numbers climbing to $1.62 billion.
Interestingly, short positions seem to occupy 54.15% of these vacant positions, amounting to $876 million. Typically, when market data reveals that activity is leaning towards the bears, it may indicate a lack of interest from top market participants. This could lead to a major market decline on the charts.
Further data shows that traders now in a losing position have incurred losses. At the time of writing, long profits and losses (PNL) had dropped by $45.5 million, while short traders had made $125.75 million during this period.
In short, this suggests that selling is more profitable, which might have influenced the Bitcoin drop over the past 24 hours. Ambcrypto also discovered that, over the long term, institutional participants are actively buying.
Institutional Investors Continue Accumulating
While the hyper-liquid whales are primarily selling, institutional investors have been actively purchasing Bitcoin. Netflows tracking inflows and outflows confirm this.
Similarly, in the past 24 hours, investors purchased $165.7 million worth of BTC. Such a large amount is a sign of high interest in Bitcoin.
The fund market premium is another key indicator that compares the Bitcoin price on institutional investment platforms to the broader spot market, showing the buying activity on these platforms. At the time of writing, the metric sits above the neutral level of 0.
Ambcrypto also found that this institutional buying sentiment seems to align with the accumulation decisions of long-term holders. In the past seven days, there has been a noticeable decline in asset movements, with the binary CDD (Coin Day Destruction) reading at 0.285.
Here, the binary CDD tracks the activity of long-term holders on a scale from 1 to 0. The closer it is to 0, as in the current situation, the more purchasing and holding activity there is. This suggests that these investors are regaining a bullish outlook on the overall market.
U.S. Investors Are Selling
Lastly, U.S. investors are following the same path as the currently selling hyper-liquid whales, with the Coinbase Premium dropping to -0.04. When this premium enters the negative region, it signals significant selling pressure.
Typically, U.S. investors influence Bitcoin’s long-term movements, which means that if their selling pressure continues to rise, Bitcoin could experience further declines. However, if selling pressure eases, Bitcoin could rebound based on the bullish wave from institutional investors.
Overall, any key shift in either direction (bullish or bearish) will give us clearer insights into Bitcoin’s path over the coming weeks and months.
