The cryptocurrency industry saw one of the most spectacular crashes of one of its giants earlier this month, which cast doubt over the entire market and investors’ perspectives on it.

However, on-chain data shows that retail investors have continued accumulating bitcoin with enhanced appetite.

Crabs and Shrimps Keep Buying

Bitcoin shrimps, as categorized by Glassnode and other analytic platforms, are entities holding up to one whole BTC. These types of wallets had previously spiked during bull cycles when the asset’s price was increasing rapidly.

They tend to act differently in bear markets, either standing on the sidelines or simply disposing of their holdings. Although there’s no clear community consensus on whether BTC has bottomed yet now, the asset has been unquestionably in a bear cycle state for the past several months.

Yet, these entities resumed accumulating earlier this month, which coincided with the FTX collapse. In fact, they purchased 96.2K BTC in the past few weeks, which is “an all-time high balance increase.” The company’s recent report said they hold over 1.21 million BTC or about 6.3% of the circulating supply.

 
  #Bitcoin Shrimps (< 1$BTC) have added 96.2k $BTC to their holdings since FTX collapsed, an all-time high balance increase. 
  This cohort now now hold over 1.21M $BTC, equivalent to 6.3% of the circulating supply. 
  Pro Dashboard: https://t.co/HpXwoav6wO pic.twitter.com/7U4oPAAakD 
  — glassnode (@glassnode) November 28, 2022

The situation with bitcoin crabs (up to 10 BTC) is similar. They have seen an “aggressive balance increase of 191.6k BTC over the last 30 days,” breaking the July 2022 all-time accumulation peak.

At the same time, though, Glassnode warned that bitcoin whales have been “lightening” their holdings by offloading 6.5K BTC to exchanges within the same timeframe. Nevertheless, the analytics resource said this distribution remains “very small relative to their total holdings of 6.3M BTC.”

 
  The primary cohort which has been lightening their #Bitcoin holdings are Whales (1k+ $BTC). 
  Whales have released approximately -6.5k $BTC to exchanges on net over the last month. 
  Whilst this is distribution, it remains very small relative to their total holdings of 6.3M $BTC. pic.twitter.com/1VoRmVAXFb 
  — glassnode (@glassnode) November 28, 2022

The FTX Collapse Itself

As mentioned above, the current behavior of retail investors is somewhat surprising given what has happened with the industry in the past several months, especially the rapid FTX collapse.

Tom Lee described 2022 as a “horrific” year, which began with price slumps due to macroeconomic events, took another hit following the Terra crash, worsened with the subsequent bankruptcy filings from numerous entities, and culminated with FTX.

It all started with a leaked balance sheet showing that Alameda and FTX were overexposed to the latter’s native cryptocurrency. This prompted Binance to want to sell its FTT holdings.

Things unraveled quite rapidly from there on, with Alameda trying to buy Binance’s shares at lower prices, people losing trust and aiming for withdrawals, and SBF saying assets were “fine,” but they weren’t. Just a few days later, FTX, Alameda, and numerous subsidiaries had to file for bankruptcy after Binance backed off a potential acquisition deal.

Multiple reports have emerged since then depicting what went wrong with SBF’s empire, but most show that it was run highly unprofessionally. While all this transpired within a few weeks, the crypto market cap shed $200 billion, and prices plummeted. This could flush out some investors from the scene, but it seems this is different with retail and their BTC holdings.

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