Bitcoin’s recent price volatility has led many to wonder if large-scale bitcoin hodlers are taking advantage of price dips to accumulate more bitcoin. While some metrics may initially suggest an increase in long-term holdings, a closer examination reveals a more nuanced story, especially after the current prolonged period of choppy consolidation.
Are Long-Term Holders Accumulating?
Upon initial observation, long-term Bitcoin holders are seemingly increasing their holdings. According to the Long Term Holder Supply, since July 30th, the amount of BTC held by long-term holders has increased from 14.86 million to 15.36 million BTC. This surge of around 500,000 BTC has led some to believe that long-term holders are aggressively buying the dip, potentially setting the stage for the next significant price rally.
Figure 1: Long Term Holder Supply of BTC increased by 500,000 as the bitcoin price dipped and rebounded. Access Live Chart 🔍
However, this interpretation might be misleading. Long-term holders are defined as wallets that have held BTC for 155 days or more. This week we’ve just surpassed 155 days since our most recent all-time high. Therefore, it is likely that many short-term holders from that period have simply transitioned into the long-term category without any new accumulation occurring. These investors are now holding onto their BTC, hoping for higher prices. So in isolation, this chart does not necessarily indicate new buying activity from established market participants.
Coin Days Destroyed: A Contradictory Indicator
To further explore the behavior of long-term holders, we can examine the Supply Adjusted Coin Days Destroyed metric over the recent 155-day period. This metric measures the velocity of coin movement, giving more weight to coins that have been held for extended periods. A spike in this metric could indicate that long-term holders possessing a substantial amount of bitcoin are moving their coins, likely indicating more selling as opposed to accumulating.
Figure 2: Supply Adjusted CDD (90dma) at levels typically reached at bull-cycle peaks. Access Live Chart 🔍
Recently, we have seen a significant increase in this data, suggesting that long-term holders might be distributing rather than accumulating BTC. However, this spike is primarily skewed by a single massive transaction of around 140,000 BTC from a known Mt. Gox wallet on May 28, 2024. When we exclude this outlier, the data appears much more typical for this stage in the market cycle, comparable to periods in late 2016 and early 2017 or mid-2019 to early 2020.
Figure 3: Mt. Gox repayment wallet movement has skewed CDD data. Current profit taking is at typical levels. Access Live Chart 🔍
The Behavior of Whale Wallets
To determine whether whales are buying or selling bitcoin, analyzing wallets holding substantial amounts of coins is crucial. By examining wallets with at least 10 BTC (minimum of ~$600,000 at current prices), we can gauge the actions of significant market participants.
Since Bitcoin’s peak earlier this year, the number of wallets holding at least 10 BTC has slightly increased. Similarly, the number of wallets holding 100 BTC or more has also seen a modest rise. Considering the minimum threshold to be included in these charts, the amount of bitcoin accumulated by wallets holding between 10 and 999 BTC could account for tens of thousands of coins bought since our most recent all-time high.
Figure 4: 10+ BTC wallets have seen a rise in the last few weeks after a substantial decrease on our run-up to a new ATH. Access Live Chart 🔍
However, the trend reverses when we look at larger wallets holding 1,000 BTC or more. The number of these large wallets has decreased slightly, indicating that some major holders might be distributing their BTC. The most notable change is in wallets holding 10,000 BTC or more, which have decreased from 109 to 104 in the past months. This suggests that some of the largest bitcoin holders are likely taking some profit or redistributing their holdings across smaller wallets. However, considering most of these extremely large wallets will typically be exchanges or other centralized wallets it’s more likely these are a collection of trader and investor coins as opposed to any one individual or group.
Figure 5: 10,000+ BTC wallets have steadily declined since the bear cycle lows and have not seen sustained buying since. Access Live Chart 🔍
The Role of ETFs and Institutional Inflows
Since reaching a peak of $60.8 billion in assets under management (AUM) on March 14th, the BTC ETFs have seen an AUM decrease of around $6 billion, however when taking into account the price decrease of bitcoin since our all-time high, this roughly equates to an increase of approximately 85,000 BTC. While this is positive, the increase has only negated the amount of newly mined Bitcoin during the same period, also 85,000 BTC. ETFs have helped reduce selling pressure from miners and potentially from large holders but haven’t significantly accumulated enough to impact the price positively.
Figure 6: BTC ETF’s have only increased their bitcoin holdings enough to negate newly minted bitcoin since our all-time high.
Retail Interest on the Rise
Interestingly, while big holders appear to be selling BTC, there has been a significant increase in smaller wallets – those holding between 0.01 and 10 BTC. These smaller wallets have added tens of thousands of BTC, showing increased interest from retail investors. There’s been a net change of around 60,000 bitcoin from 10+ BTC wallets to smaller than 10 BTC. This may seem alarming, but considering we typically see millions of bitcoin switch from large and long-term holders to new market participants throughout an entire bull cycle, this is not currently any cause for concern.
Figure 7: Wallets between 0.01 BTC and 10 BTC have accumulated all larger wallet selling, approximately 60,000 BTC. Access Live Chart 🔍
Conclusion
The narrative that whales have been accumulating bitcoin on dips and throughout this period of chopsolidation does not seem to be the case. While long-term holder supply metrics initially appear bullish, they largely reflect the transition of short-term holders into the long-term category rather than new accumulation.
The increase in retail holdings and the stabilizing influence of ETFs could provide a strong foundation for future price appreciation, especially if we see renewed institutional interest and continued retail inflows post halving, but is currently contributing little to any Bitcoin price appreciation.
The real question is whether the current distribution phase seizes and sets the stage for a new round of accumulation, which could propel Bitcoin to new highs in the coming months, or if this flow of old coins to newer participants continues and likely suppresses the potential upside for the remainder of our bull cycle.
🎥 For a more in-depth look into this topic, check out our recent YouTube video here: Are Bitcoin Whales Still Buying?
And don’t forget to check out our other most recent YouTube video here, discussing how we can potentially improve one of the best bitcoin metrics:
Unveiling the Truth Behind Whale Activity: Are Major Bitcoin Holders Truly Buying the Dip, or Is the Market in a Redistribution Phase?
Amazon’s journey from a modest online bookstore to the world’s largest online retailer is a narrative of innovation, disruption, and relentless ambition. Today, Amazon dominates the e-commerce landscape, setting the standard for online shopping with its vast product selection, lightning-fast delivery, and customer-centric approach. This article explores the evolution of Amazon’s leadership in online shopping, examining the key strategies, innovations, and challenges that have shaped its rise to the top.
The Early Days: From Bookstore to Everything Store
Amazon was founded by Jeff Bezos in 1994 as an online bookstore, capitalizing on the internet’s potential to reach a global audience. The decision to start with books was strategic; books were easy to ship, did not require much storage space, and had a universal appeal. From the beginning, Bezos envisioned Amazon as more than just a bookstore. His long-term goal was to create the “everything store,” a one-stop-shop where customers could find and purchase anything they needed online.
The initial success of Amazon was driven by its innovative approach to e-commerce. While traditional bookstores were limited by physical space, Amazon offered an extensive catalog of books that was virtually limitless. The company’s early focus on customer satisfaction, with features like customer reviews, personalized recommendations, and a user-friendly interface, set it apart from competitors.
By 1997, Amazon had gone public, and its rapid growth continued. The company began to expand its product offerings beyond books, gradually adding categories like music, electronics, and toys. This diversification was essential to Amazon’s strategy of becoming the go-to online retailer for all consumer needs. The company’s ability to offer a wide range of products, combined with its commitment to customer service, established it as a leader in online shopping.
Innovation and Expansion: The Prime Revolution
One of the most significant milestones in Amazon’s evolution was the launch of Amazon Prime in 2005. For an annual fee, Prime members received free two-day shipping on eligible purchases, a proposition that was revolutionary at the time. The introduction of Prime was a game-changer, transforming customer expectations and further solidifying Amazon’s leadership in online shopping.
Prime was more than just a shipping service; it was a strategic move to create customer loyalty. The subscription model incentivized customers to make Amazon their default shopping destination, as the more they used Prime, the more value they received. Over time, Amazon expanded the benefits of Prime to include streaming video and music, exclusive deals, and other perks, making it an indispensable service for millions of customers.
The success of Prime can be measured by its membership numbers, which have grown exponentially over the years. As of 2024, Amazon Prime has over 200 million members worldwide, a testament to the value it offers. The Prime membership model has been so successful that it has influenced the broader retail industry, with many competitors launching their own subscription services in response.
The Technology Edge: Fulfillment and Logistics
Amazon’s dominance in online shopping is not just a result of its vast product selection and customer-centric approach; it is also rooted in its technological prowess. The company has invested heavily in building a state-of-the-art fulfillment and logistics network, which has been a critical factor in its ability to offer fast, reliable delivery to customers.
Amazon’s fulfillment centers, which are strategically located around the world, are marvels of automation and efficiency. These facilities use advanced robotics, artificial intelligence, and data analytics to manage inventory, process orders, and ship products with unparalleled speed. The company’s ability to deliver products quickly and accurately is a key reason why customers choose Amazon over other online retailers.
In addition to its fulfillment centers, Amazon has developed a vast logistics network that includes its own fleet of planes, trucks, and delivery vehicles. The company’s investment in logistics has allowed it to reduce its reliance on third-party carriers like UPS and FedEx, giving it greater control over the delivery process. This vertical integration has enabled Amazon to offer services like same-day and next-day delivery, further enhancing its competitive advantage.
Moreover, Amazon’s logistics innovations extend beyond its own operations. The company’s delivery service partner (DSP) program has created opportunities for small businesses to operate delivery routes for Amazon, while its crowd-sourced delivery platform, Amazon Flex, allows individuals to deliver packages using their own vehicles. These initiatives have expanded Amazon’s delivery capacity and ensured that it can meet the growing demand for fast shipping.
Expanding the Ecosystem: Marketplace and AWS
Another key component of Amazon’s success in online shopping is its ability to create a comprehensive ecosystem that extends beyond retail. The Amazon Marketplace, launched in 2000, has been instrumental in expanding the company’s product selection and driving revenue growth. The Marketplace allows third-party sellers to list their products on Amazon’s platform, giving customers access to a wider range of goods and enabling Amazon to earn a commission on each sale.
The success of the Marketplace has been staggering. Today, over half of the products sold on Amazon are from third-party sellers, many of whom are small and medium-sized businesses. The Marketplace has also been a critical factor in Amazon’s global expansion, as it allows sellers from around the world to reach customers in different markets without the need for a physical presence.
In addition to the Marketplace, Amazon Web Services (AWS) has played a crucial role in the company’s growth and profitability. Launched in 2006, AWS offers cloud computing services to businesses, allowing them to store data, run applications, and scale their operations with ease. AWS has become the backbone of the internet, powering everything from startups to large enterprises. The revenue generated by AWS has given Amazon the financial flexibility to invest heavily in its retail operations, including its logistics network, Prime, and original content for Prime Video.
Challenges and Criticisms
While Amazon’s leadership in online shopping is undeniable, it has not been without challenges and criticisms. The company’s dominance has raised concerns about its impact on competition, with critics arguing that Amazon’s scale and market power give it an unfair advantage over smaller retailers. There have also been concerns about the treatment of workers in Amazon’s fulfillment centers, with reports of grueling conditions and low wages sparking public outcry and calls for better labor practices.
Amazon has also faced scrutiny over its impact on the environment. The company’s rapid delivery services, which require a vast logistics network, contribute to carbon emissions and environmental degradation. In response, Amazon has pledged to achieve net-zero carbon emissions by 2040 and has invested in renewable energy and electric vehicles to reduce its environmental footprint.
Despite these challenges, Amazon continues to grow and innovate, constantly pushing the boundaries of what is possible in online shopping. The company’s ability to adapt to changing consumer preferences, invest in technology, and create a seamless shopping experience has ensured its position as the leader in e-commerce.
The Future of Amazon in Online Shopping
As Amazon looks to the future, it faces both opportunities and challenges. The rise of new technologies like artificial intelligence, machine learning, and automation will continue to shape the e-commerce landscape, and Amazon is well-positioned to leverage these innovations to enhance its operations and customer experience.
The company is also likely to continue expanding its ecosystem, integrating its retail operations with other services like AWS, Prime Video, and Alexa. This integration will further entrench Amazon in the daily lives of consumers, making it even more difficult for competitors to challenge its dominance.
In conclusion, Amazon’s leadership in online shopping is the result of a relentless focus on customer satisfaction, innovation, and scale. From its early days as an online bookstore to its current status as a global e-commerce giant, Amazon has consistently pushed the boundaries of what is possible in retail. As the company continues to evolve, it will undoubtedly remain a dominant force in the world of online shopping, shaping the future of commerce for years to come.
