Saturday, July 20, 2024

WBTC custodian is blamed for a spike in addresses holding more than 1K Bitcoin.

A record increase in addresses that hold over 1000 BTC was seen on February 28. It was associated with a WBTC holder that created new addresses. There was no whale accumulation. Addresses that hold over 1000 BTC are referred as whales.

The day saw the whale number increasing by about 148 addresses, according to a Glassnode data. This spike was considered a whale accumulation initially but later analysis showed it was due to a wrapped bitcoin or WBTC custodian moving its BTC to new addresses.

The data shows there was no correlating increase in bitcoins leaving exchanges. It only indicated a large player shuffling wallets, leading to a sudden increase in the new addresses.

The WBTC ERC20 token is backed by BTC at a ratio of 1:1. The management of this on-chain ratio lies with WBTC custodians. It is necessary for them to hold same amount of bitcoin for every WBTC they create.

ERC20 ethereum-based standard is the building block for creating and issuing smart contracts. Prominent ERC20 tokens include BAT (Basic Attention Token), MKR (Maker), and OMG (OmiseGo).

BTC holders use WBTC for participation in ethereum DeFi protocols like staking and lending. This option lets BTC become compatible with ethereum blockchain.

Movements of whales have always affected the crypto market significantly. Players holding large amount of coins regularly affect market capitalization and price movements. Even a small move by them makes a big impact in the market because they move millions of dollars.

Accumulation by whales is taken by the market as a sign to buy, while their selling leads to fear and uncertainty.

The original bitcoin creator Satoshi Nakamoto is considered to hold about 1 million BTC. Other notable holders include the Winklevoss twins, the founder of Gemini exchange who is said to hold thousands of bitcoin.

Cryptured Team
Cryptured Team
The writers team at Cryptured.com is composed of passionate and experienced journalists who cover the latest developments in the crypto and blockchain space. They aim to provide accurate, unbiased and easy-to-understand news and information for their readers, as well as insights and analysis from industry experts. The writers team is always on the lookout for new and exciting stories that can help the general public learn more about the potential and challenges of these technologies.
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