Crypto analytics firm Glassnode says Bitcoin is witnessing a major spike in large transactions this year, indicating that deep-pocketed investors are fueling its 2021 resurgence.
During the 2019-2020 bear market, the average Bitcoin transaction size was $6,000-$8,000, and the period was dominated by retail investors and early investment fund participants, according to the firm.
By comparison, the bull run between late 2020 and early 2021 has seen a surge in average transaction size, climbing all the way up to $58,600 during the May sell-off.
The average BTC transaction size has cooled off since and is now hovering between $30,000 and $36,000.
Explains Glassnode,
“Relative to the 2019-20 period, this represents a significant 370% increase, despite the recent correction, reflecting continued and sticky institutional sized interest.”
The analytics firm adds that transactions larger than $10 million have grown to represent more than 30% of Bitcoin’s transaction volume dominance, up from 10% in October of last year.
“This reflects a notable growth in large-size capital allocation and trading activity.”
Bitcoin plummeted in price in the past day from a high of $52,853.45 to a low of $45,299.59, a more than 14% decrease. The crypto asset is trading at $47,256.67 at time of writing, according to CoinGecko.
Glassnode says more than $4 billion in Bitcoin open interest was cleared during the day’s sell-off. Open interest refers to the total number of derivative contracts that remain outstanding.
“This is the most significant leverage flush out since the sell-off in mid-May.”
Featured Image: Shutterstock/Juanjo Tugores