Recent on-chain data indicates that Bitcoin (BTC) whales have shifted from a prolonged distribution period to renewed accumulation and that the stablecoin supply on Binance is increasing; both metrics suggest good momentum for BTC.

According to CryptoQuant community analyst Darkfost, whales had been reducing their holdings for over a month, marking the longest sustained decline in net accumulation over the past year.

However, this trend has reversed, with whales increasing their holdings again, pushing the monthly percentage change back into positive territory. Historically, such accumulation phases have often preceded bullish market movements.

Darkfost highlighted that if whale accumulation continues, market liquidity could rise, contributing to Bitcoin’s upward price momentum. Large-scale investors typically exert significant influence on price action. 

Their buying activity signals confidence in market conditions and can trigger broader sentiment shifts among retail investors.

Binance stablecoin reserves

In parallel with whale accumulation, Binance has recorded an all-time high in stablecoin reserves, surpassing $31.3 billion.

Darkfost noted that Binance, the largest crypto exchange by trading volume, often serves as a key liquidity hub, making its stablecoin reserves a critical indicator of potential market movements.

An increase in stablecoin reserves on Binance suggests two primary factors. First, investors are injecting liquidity into the exchange, potentially in preparation for market entry. This influx of capital signals confidence in Binance’s stability and broader crypto market conditions.

Second, Binance itself is expanding its stablecoin reserves in response to rising demand, reflecting increased transactional activity on the platform.

Periods of rising stablecoin reserves on Binance have historically aligned with or preceded upward trends in Bitcoin prices. Stablecoins serve as an on-ramp for crypto investments, providing immediate liquidity for traders to enter positions.

The current accumulation trend and increased liquidity present a market environment historically favorable to potential price appreciation.

Confirmation needed

Despite the favorable setup presented by the on-chain data shared by Darkfost, Short-Term Holder (STH) Realized Price levels have been converging, indicating that the average entry price of recent Bitcoin buyers is becoming more uniform.

According to Yonsei Dent, another CryptoQuant community analyst, this suggests a market supply and demand stagnation, which has translated into a growing lack of clear price direction.

Simultaneously, the 60 and 200 daily moving averages of STH Realized Price are also tightening in a similar pattern to that observed in May 2024. This resulted in a prolonged period of low volatility and market consolidation.

Yonsei Dent assessed that if no strong demand catalyst emerges, a prolonged period of price consolidation might repeat itself.

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