After having greatly increased in number following the Bitcoin price drop that was triggered following the collapse of cryptocurrency exchange FTX in early November, the number of so-called Crab, Fish and Shark cryptocurrency addresses has stabilized, according to data from on-chain cryptanalytic company Glassnode.
Crab addresses are Bitcoin wallets with between 1 and 10 BTC and are generally assumed to be engaged retail investors (or HODLers). Fish addresses hold between 10 and 100 BTC, while Shark addresses hold between 100 and 1,000 BTC. These two cohorts of addresses are typically made up of high net worth individuals, dealing desks, and institutional-sized entities, according to Glassnode.
Following the FTX Collapsethe number of Crab addresses has fallen from around 760,000 to current levels of around 824,000. The 30-day change in the number of Crab addresses peaked at around 47,000 in early December, but has since fallen to a few thousands only.
During the same period, the number of Fish and Shark addresses increased from 135,000 to 139,000 and from 13,700 to 14,050 respectively. However, as has been the trend with crab addresses, the 30-day rate of change for both has now fallen back to around zero.
What Slowing Crab, Fish, and Shark Address Accumulation Means for BTC Price
Medium-to-large sized crypto investors, which include large retail investors, high net worth individuals, trading desks and institutions – generally considered a well-informed cohort – have clearly used the collapse-induced price decline post-FTX as an opportunity for buy the dip. Bulls will say this is evidence of confidence in bitcoin as an asset class.
As these cohorts accumulated, the number of smaller shrimp and plankton addresses (with less than 1 BTC) began to stagnate/decline. This is a sign that the less well smaller and probably informed investors were pulling out of the market, resulting in BTC flows to the larger and more informed investors.
The stagnation in the accumulation of these latter groups suggests that this trend has likely come to an end as the price of Bitcoin rebounded in January. This could be taken as an indication that the capitulation of retail investors has eased. But the shrimp and plankton address numbers have yet to start picking up. Given that Bitcoin bull markets have always been characterized by an increase in demand from small investors (and a subsequent increase in the small number of addresses), this suggests that sentiment still has a long way to go.
Many Bitcoin bulls are not worried. A slew of on-chain and technical indicators are now screaming that Bitcoin’s bottom for this market cycle may now be reached. -opportunity to buy in the future”.