The third largest holder of bitcoin has added more than $150 million worth of the cryptocurrency to their holdings following the latest price crash.
Data from blockchain monitoring service BitInfoCharts shows the investor “bought the dip” with a purchase of more than 3,000 bitcoins over the last couple of days.
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The anonymous investor now holds close to $6 billion worth of bitcoin, having made more than $3 billion in profit over the last couple of years as a result of bitcoin’s rising price.
It follows a major price crash for bitcoin, which saw it fall from above $57,000 to below $46,000 in less than 24 hours last week.
Bitcoin’s price has since recovered slightly, hovering around $50,000 on Wednesday, however remains a long way off the all-time high it experienced last month of close to $69,000.
The crypto address first became active in February 2019, when bitcoin’s price was around $3,000.
After an initial investment of 10,000 bitcoins, the wallet accumulated tens of thousands of BTC over the next two years. The latest buy-in of 3,090 bitcoins takes the total holdings to 118,405 BTC, bought at an average price of $21,160 per coin.
While bitcoin’s semi-anonymous nature means the investor is unknown, some crypto market commentators have suggested it could be a large institutional entity or individual.
Speculation has also been drawn to the possibility that it is a so-called cold wallet used by a large cryptocurrency exchange, though one analyst claimed the activity was unlike that of an active exchange.
“Transaction volume and pattern doesn’t seem to support this, very inconsistent from other cold wallets,” pseudonymous analyst VentureFounder said. “For one, many strategic buy the dip and sell the rally behaviours and clear long term accumulation trend.”
The latest purchase bucks the trend of other large bitcoin holders, known as whales, who have taken the opportunity to skim off profits following the recent record high.
“Digital asset markets have seen huge amounts of selling from crypto whales, who have been moving bitcoin from the wallets and depositing to exchanges at a staggering rate,” Marcus Sotiriou, a sales trader at the UK-based digital asset broker GlobalBlock, told The Independent.
The accumulation by the third largest bitcoin holder could be through the belief that the bull run of 2020/21 is not yet over and new all-time highs could be seen later this month or early next year.
“I don’t think this is the end to the bull cycle,” Mr Sotiriou said. “[The latest price drop] has given weight to the lengthening cycle theory, where this bull market could extend into 2022, contrary to many analysts’ expectations of a blow off top in 2021.”
