“Bitcoin whales” is a term given to those who own many bitcoins and accumulate them in their digital wallets.

According to a new statistic issued by the company,glassSpecialized in analyzing blockchain transactions, the number of bitcoin addresses containing more than 10,000 bitcoins or more has increased, and these whales have held their currencies for more than 111 days, the highest level recorded since August 2, 2019.

This means that the number is up more than 11% since early March.

stated Matthew Depp, co-founder of Stack, a platform that allows tracking of cryptocurrency and index funds, says:

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The increase in the number of bitcoin addresses holding more than 10,000 bitcoins is likely the result of long-term bitcoin holders returning to expand their holdings.

It is possible that the increased interest from long-term investors and major investors has increased after the recent Bitcoin rally and the upcoming Bitcoin reward split.

Interlapse CEO Wen Chen commented:

Some of these addresses may belong to individuals or groups of high net worth individuals, who are getting in and out of Bitcoin due to the impact of the coronavirus and the approaching Bitcoin reward split.

The Bitcoin reward split event is a significant positive event for many analysts and observers and sees that Bitcoin is on the way to shrink further, as the total Bitcoin supply has been set at 21 million coins, and the Bitcoin Cash policy is pre-programmed to reduce the pace of supply expansion by 50 percent every four years.

Thus, many proponents are touting Bitcoin as an asset, a safe haven, and a hedge against inflation just like gold.

They claim that the economic devastation caused by the coronavirus pandemic and unprecedented money printing by global central banks and governments bode well for Bitcoin prices.

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Simon Peters, an analyst and expert on crypto assets at the eToro investment platform, commented:

Amid the deteriorating economic outlook for the US economy and the prospect of a persistently increased money supply, which is weakening the US dollar and heightening inflation fears, we believe that Bitcoin can easily test previous highs above $19,000 as investors look for safe havens away from traditional assets.

These bullish expectations have been swirling for more than six weeks now, and so could entice major investors to add bitcoins to their portfolios.

In addition, expectations that the reward halving on May 12 will put Bitcoin in a long-term bullish trend, which could be the reason for the rise in the number of Bitcoin whale addresses.

Bitcoin undergoes a process called a mining reward split every four years, which controls inflation by reducing mining rewards by 50%.

After the next halving in the current month of May 2020, the reward per block of metal will drop from 12.5 BTC to 6.25 BTC.

See: Bitcoin Bonus Split Explained

Many investors expect that the price of Bitcoin will rise after the next halving, as the asset becomes more scarce to meet demand, and this belief is reinforced by historical data, which shows Bitcoin experiencing revolutions and a strong rise after each halving for more than a year.

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George McDonough, managing director and co-founder of a cryptocurrency investment firm, said:

At the first halving in November 2012, the price rose from $11 to more than $1,100 per coin the following year.

Then after the second halving in July 2016, the price of Bitcoin soared from $600 to over $20,000 by the end of 2017.

However, halving the reward also means a 50% drop in miners’ revenue.

Therefore, if the price fails to rise sharply after the halving, small and inefficient miners may shut down their equipment and empty their holdings to cover costs, driving down the price.

Bitcoin Rise:

Bitcoin is trading near $8,900 at the time of writing, a 130% gain from the previous low of $3,867 recorded on March 13.

Bitcoin records significant gains compared to gold, while the cryptocurrency is up 21%, the yellow metal has seen a 12% increase.

Year-to-date performance may bolster the narrative that bitcoin is a hedge against global economic turmoil and fiscal and monetary indiscipline and could continue to attract demand from both small and large investors.

Matthew Depp says:

The performance to date indicates that investor awareness of digital assets has increased and that its role as a potential diversification vehicle for traditional portfolios has been underlined by its strong recovery from recent lows, compared to traditional markets.

This strength will continue as Bitcoin continues to lead the race.

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