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Silicon Valley and “Smart Money” would be behind Bitcoin’s uptrend

November 9, 2020

Bitcoin (BTC) continues to show strong momentum even after a major rally. The key data shows that the upward trend in the past few months has likely been driven by smart money. This means that retail or mainstream investors were largely on the sidelines as the price of BTC topped $ 15,000 that month.

In 2017, when the price of Bitcoin hit an all-time high of $ 20,000, retail demand was at its peak. Google Trends data skyrocketed, media coverage increased dramatically, and spot exchange volume increased in major markets, particularly South Korea and Japan.

This time, Google Trends’ interest in the keyword “Bitcoin” is relatively low.While on-chain data shows that smart money is hoarding BTC.

Wealthy investors buy Bitcoin

Silicon Valley and “Smart Money” would be behind Bitcoin’s uptrend
Silicon Valley and “Smart Money” would be behind Bitcoin’s uptrend

In addition, according to the chain analyst Willy woos, It was mostly wealthy investors who bought Bitcoin.

Average bitcoin transfer volume. Source: Glassnode

When whales buy Bitcoin, they mostly facilitate business through the OTC (over-the-counter) market. Over time, the spot and derivatives markets follow the OTC market as whales lead the boom. Courting said::

Who bought this rally? It’s smart money … high net worth individuals. You can see that the average transaction value among investors is taking a huge leap. The OTC market is also observing this. Bitcoin is still in the stealth phase of its bull run. “

The trend of whales at the top of retail investors is bullish as it shows that Bitcoin is still in the beginning bullish phase. The huge capital of new private investors and large investors has yet to enter the cryptocurrency market.

Another metric of Glass knot show a similar trend. The number of Bitcoin addresses with more than 100 BTC hit a seven-month high of 16,271.

Number of addresses with holdings over 100 BTC. Source: Glassnode

The new money is coming

The whales that have been steadily buying Bitcoin over the past few months are optimistic in themselves. However, Woo emphasized that the number of new whales had also increased.

When the number of addresses with large amounts of Bitcoin increases, Analysts see this as a general increase in new whales.

The rise of high net worth individuals amassing Bitcoin coincides with the onset of the recent institutional frenzy over BTC.

After Square bought BTC for $ 50 million The number of wealthy investors in the Bitcoin market has increased significantly. Woo stated:

“The best thing is, we don’t just see Smart Money Flow, it’s NEW Smart Money. The orange line is the rate of new investors entering the Blox per hour. He is very optimistic. “

Google Trends data shows relatively little retail interest

Google Trends data indicates a representation that is similar to chain data points. The search volume for the keyword “Bitcoin” is currently less than 10% compared to the beginning of 2017.

Bitcoin search volume on Google. Source: Google Trends

Although the search volume for Bitcoin is still low, States such as Hawaii, California, Nevada and Washington are particularly interested.


Bitcoin search interest by subregions in the US Source: Google Trends

Oddly enough California and Hawaii rank third and fourth highest in per capita income by state in 2020.

Also San José / San Francisco in California, i.e. Silicon Valley is the main metropolitan area of ​​interest for Bitcoin. There are of course many wealthy investors and entrepreneurs living in Silicon Valley.