Bitcoin’s (BTC) price dropped by more than 50% after peaking out at $69,000 six months ago but the plunge did little in forcing some of its wealthiest investors into selling.
Notably, the number of Bitcoin under Coinbase Custody for institutional clients rose by 296% since Q4 2020, showcasing the most investors decided to “hodl” onto their investments despite BTC price down well over 50% from its all-time highs.
JUST-IN: #Bitcoin under @Coinbase Custody for institutional clients increased by 296% since Q4’20. pic.twitter.com/iILge2Cane
— CryptoQuant.com (@cryptoquant_com) May 30, 2022
For instance, institutions that deposited 10,939 BTC (~$335 million at today’s price) with Coinbase Custody in December 2020, when BTC/USD was around $23,000, have not moved since, on-chain data from CryptoQuant shows.
Ki Young Ju, CEO of CryptoQuant, noted:
“For most cases, the same amount of BTC is still in the (custodian) wallets, which flowed out from Coinbase for highly likely institutional purchases in December 2020.”Coinbase custodial wallets comparison. Source: CryptoQuant/Ki Young Ju
If this is the case, then these institutions are currently sitting on 30% profits from their BTC investments. Meanwhile, their decision to not unwind their Bitcoin positions, even when BTC/USD has plummeted by more than half, underscores their strong “hodling” sentiment.
That also points to institutions’ ability to withstand additional declines in the Bitcoin price, at least until it drops below the investors’ breakeven level of $23,000.
Bitcoin bear market not over?
Bitcoin’s price has been fluctuating inside the $29,500-$30,500 range since May 12, underscoring the market’s indecision in a higher interest rate environment.
Related: On-chain data flashes Bitcoin buy signals, but the bottom could be under $20K
But several technical analysts anticipate that BTC’s price would continue its prevailing downtrend.
For instance, PostyXBT, an independent market analyst, argues that the token could fall toward its 200-week moving average (the $20,000-22,000 range) next, as shown in the setup below.
BTC/USDT weekly price chart. Source: PostyXBT/TradingView
Meanwhile, Popular analyst Rekt Capital adds that a drop toward the 200-week MA could also have Bitcoin form a bearish wick, which might take its price to as low as $15,500-$19,000.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
