Published: 29.03.2022
Article reading time:
2 minutes.
DataDash CEO Nicholas Merten believes that short-term investors and traders with leverage influence the volatility of bitcoin, and “whales” influence the growth.
Nicholas Merten said that the recent sharp growth in the market is due to the activity of large investors. He clarified that “whales” and other institutional investors accumulating bitcoins, despite macroeconomic and geopolitical uncertainty, are the catalyst for a sudden increase in the price of BTC.
“There has been so much panic around the macro environment over the past couple of months. The Fed raises interest rates and initiates quantitative tightening to curb inflation. The war between Ukraine and Russia, the potential next wave of COVID-19 – all these problems caused investors to be pessimistic and made them think that “whales”, large investors and companies, were going to sell bitcoins. At the same time, “whales”, on the contrary, did not sell cryptocurrency in large volumes. In fact, we have seen long-term investors continue to either buy more or hold on to bitcoin. The first wave of HODL proves it,” he said.
The CEO of DataDash believes that “whales” have been buying bitcoin for the past six months, while short-term and leveraged traders have been causing the price to fluctuate up and down.
“During this time, we saw an increase in the price of bitcoin by almost 10% compared to September and October [2021 года] until the end of March. It has only been a couple of months since the “whales” bought large amounts of bitcoins and kept them in their wallets. All the up and down price volatility that we see in the market is most likely due to the liquidation of short-term and leveraged traders,” Merten said.
He stated that despite Bitcoin’s 50% drop from its all-time high of $69,000 in November, BTC has remained in a bull market all along.
“These tendencies are caused by liquidity reduction. Those bitcoin lows that have been observed over the past year or a year and a half are not a sign that the trend has died and we are in a bear market,” says Merten.
The head of DataDash summed up that the first wave of HODL is of great historical importance. At the same time, he warned investors that you should not rely on it completely, it is important to take into account the existence of many other ways to analyze supply and demand in the bitcoin market.
Merten said in March that sideways price movement and a correction are the harbingers of the imminent arrival of institutional investors.
Source: Bits
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