Bloomberg News reports that investors were found buying the big crypto dig when the FTX and Terra ecosystems fell apart. Meanwhile, the smaller mom-and-pop merchants were suffering as the so-called “whales” were sold in large quantities.
A study by Bank for International Settlements
This was per a study conducted by the reputed Bank for International Settlements. Following the crypto exchange data analysis, the bank has concluded that several at-home investors have lost out on their investments. The losses were further aggravated by a large for sophisticated market players that sold their coins before a steep drop in the price was observed in the past year.
According to Jon Frost, Leonardo Gambacorta, and Giulio Cornelli, whales eat the krill in the stormy seas, as they revealed the same sentiment in a report dated February 20th. Retail investors have chased prices, and the majority of them have lost money.
Scenario last year
The last year was found testing the resolve of all kinds of investors. It included the calamitous collapse of projects that were earlier well-regarded. It also encompasses the crash of FTX, Terra ecosystem/Luna. Bitcoin dropped by more than 64% in 2022, which started the year at approximately $47,300, and it was found to be close near about $16,500 as per data compiled by Bloomberg.
What about digital asset investors?
Bloomberg News reports that the investors of digital assets that play on their terms usually hold or “hold,” even when the seas are rough. The term “bag holders” is usually given to investors who suffer huge losses and witness their investments lose value.
What did BIS researchers discover?
To investigate the crypto trading patterns, the researchers of BIS developed a database wherein the exchange apps used by retail investors across 95 nations were worked out. The data taken into account was from August 2015 to December 2022. The team carrying out the study found that with a surge in prices in the stretch and with Bitcoin touching the near $69,000 level in November 2021, more and more users started entering and using the system.
The number of active daily users escalated to 30 million globally from the 100,000 mark.
Whale Watching
Despite the above scenario, over the months of last year, amidst the collapse of Terra/Luna and after the FTX disintegrated, the crypto tokens suffered huge losses. However, it was also observed that the trading activity gained momentum markedly.
The large wallets’ owners, usually known as “whales,” were found reducing their holdings of Bitcoin following the so-called “shock episodes.” “krill” refers to smaller or medium-sized investors, and it was found that their exposures increased remarkably.
