The Bitcoin (BTC) network has seen a slump in the total number of non-zero addresses, a trend that was reportedly triggered by the emergence of Bitcoin ETF products.
Of the major metrics for assessing the health of the Bitcoin network, the number of addresses holding more than 0 BTC helps judge the true level of adoption.
Days after the United States Securities and Exchange Commission (SEC) approved spot Bitcoin ETF for trading, this metric started seeing reduced figures.
According to data from Santiment, in just a month, the number of non-zero Bitcoin addresses shrank by approximately 729,400.
Bitcoin In Reverse, Ethereum In Rebound Mode
The Santiment data showed that Bitcoin’s non-zero wallet addresses peaked at 52.95 million on January 20 but later dropped. According to Santiment, the reason for the slump was the exposure to spot Bitcoin ETF.
One of the major promotional strategies for these asset classes was the ease of adoption as it generally takes away the stress and risks in custody from the investor. Santiment suggested investors are gradually opting for the ETF version rather than the physical BTC.
While Bitcoin has recorded a slump in its non-zero addresses, Ethereum (ETH) and Tether (USDT) have coasted to their All-Time Highs of 114.95 million and 5.22 million holders, respectively.
📊 There are 729.4K less #Bitcoin wallets holding greater than 0 $BTC, compared to one month ago. After the #SEC approved 11 Spot Bitcoin #ETF's, this amount of non-0 wallets peaked on January 20th at 52.95M. This is attributed to the increased interest in #hodlers
(Cont) 👇 pic.twitter.com/FThtSDOmk0
— Santiment (@santimentfeed) February 21, 2024
Drawing on the trend with Bitcoin, Santiment is now drawing an inference that other assets like Ethereum, which may get spot ETF in the future, might experience a corresponding drop in their non-zero wallets.
Whales are Accumulating Bitcoin
Bitcoin as an asset class has always been appealing to both retail and institutional investors. However, the spot BTC ETF product has tilted the balance.
There is an increasing embrace of Bitcoin by asset managers who, according to CryptoQuant co-founder Ki Young Ju, are now accumulating BTC ETFs.
Whales are accumulating $BTC.
Ah, my bad, fund managers are accumulating #Bitcoin ETFs.https://t.co/beKpUVllNj pic.twitter.com/WVsxp6cJMY
— Ki Young Ju (@ki_young_ju) February 22, 2024
Should this accumulation trend continue, it might significantly trigger a growth in the price and market capitalization of Bitcoin which are currently up 1.30% to $51,629.83 and $1,013,737,622,244.