Shrimp vs. whales — Smallholders scoop up Bitcoin when whales dump

CryptoSlate’s new research using Glassnode’s data has revealed that small, or retail, Bitcoin (BTC) holders are hoarding the flagship digital asset while whales have been dumping their holdings.

Retailers own less than 10 BTC in their portfolio and are also referred to as “Crabs” or “Shrimps”, while a whale has 1000 or more Bitcoins in its portfolio.

Retailers accumulated through market implosion

CryptoSlate research found that retail holders’ control of the Bitcoin supply grew from 14% to 15.3% during the bear market, with an additional 1.3% unaffected by recent price action.

Reports have indicated that Bitcoin’s crash to the $20,000 range had made the asset “attractive and affordable” for this class of investors and retail holders bought at the most aggressive price in market history at around 60,500 BTC per month.

Meanwhile, over the course of Bitcoin’s history, this group has continued to grow and has been the backbone of the bottom price formation in bear market cycles.

In recent months, this growth has accelerated, even with the uncertain economic conditions and geopolitical issues plaguing the world. Moreover, the growth comes at a time when Bitcoin’s price recorded a 66%% drop from an all-time high.

The data shows that retail owners not only participate, but also contribute to the rapid growth of the network. It also shows that Bitcoin’s adoption continues to grow despite the impact of the bear market.

Whales dump

CryptoSlate research revealed that whales have been dumping Bitcoin since the beginning of the year.

Proof of this is the recent Arcane survey which revealed that institutional investors sold 236,237 BTCs when Terra’s ecosystem crashed. Tesla, a well-known institutional Bitcoin whale, said it had sold 75% of its holdings during this period.

A recent tweet from Edris also gave credence to our research that whales have sold their assets. Edris said, “large entities are now holding their coins at a loss, forcing some of them to sell before a bigger loss is inflicted on their portfolios.”

#Bitcoin whales sell at a high rate⚠️

1. The final phase of a bear market is where even the strongest hands start to panic and sell their undervalued #BTC to exit the market as soon as possible.

Continue reading below… 👇🏼 pic.twitter.com/JZyqCDcFcp

— Edris 💀 (@TradingRage) 13 July 2022

Despite the sale, whales still have nearly 10 million BTC, over 4x what retail traders have.

The graph below shows that if the dumping trend continued, retail investors could take over whale holders, which would be a net positive for the network as more coins would be fairly distributed and reduce volatility in the long term.