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Public companies that have been actively acquiring Bitcoin and Ether have significantly reduced or halted their purchases following a market downturn in early October. This pause in accumulation signals a notable lapse in confidence among these major players, raising concerns about the market's stability.
Key Takeaways
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Corporate buyers of Bitcoin and Ether have largely ceased new acquisitions since the market drop around October 10th.
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This pullback indicates a cautious sentiment among major institutional investors.
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BitMine Immersion Technologies stands out as the sole consistent buyer of Ether during this period.
Corporate Buyers Halt Accumulation
Companies that hold digital assets on their balance sheets, often referred to as Digital Asset Treasury (DAT) companies, have "ghosted" the market since the price correction that began around October 10th. According to David Duong, global head of investment research at Coinbase Institutional, Bitcoin buying by these DATs has fallen to near year-to-date lows and has not shown significant recovery, even on days when the market turned green.
This slowdown is particularly significant because these companies are typically "heavy hitters with deep pockets." Their withdrawal from the market suggests a "limited confidence" in current price levels, even those considered support levels by some analysts. The reduced activity highlights a broader caution among large players following a period of leverage washout.
Ether Market Sees Sole Consistent Buyer
While Bitcoin treasury activity has dwindled, the Ether market has seen a notable exception in BitMine Immersion Technologies. Duong identified BitMine as the "only consistent buyer" of Ether since the market downturn. Data indicates that BitMine has invested over $1.9 billion since October 10th, acquiring nearly 483,000 ETH.
Ether experienced a significant drop alongside Bitcoin earlier this month, falling over 15% to a low of $3,686 between October 10th and 11th. Although it has since seen a slight recovery to around $4,130, BitMine's continued purchases, along with smaller contributions from other funds, have been crucial in maintaining positive total seven-day purchases by ETH treasury companies.
However, Duong expressed concern that if BitMine were to slow or pause its buying activity, the apparent corporate bid for Ether could fade. This reliance on a single major buyer introduces a degree of fragility to the market. The current situation, where the largest discretionary balance sheets are sidelined, warrants a more cautious short-term market outlook.
Sources
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Bitcoin, Ether treasuries have ‘ghosted’ since the crypto crash — TradingView News, TradingView.
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Bitcoin, Ether treasuries have ‘ghosted’ since the crypto crash, mx.advfn.com.
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