How do whales bottom-fish NFTs at market lows?
The NFT market is gradually rebounding. So, which NFTs did the whales buy at the market low, and what strategies did they adopt?Author: NFTGo
Key Takeaways
During the decline in mid-June, the order of whale accumulation was: Bored Ape Yacht Club > Other NFTs from Yuga Labs > Other blue-chip and emerging projects, and the type of accumulation, purchase price, and scale of funds are related.
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Among the super whales with accumulation funds exceeding $500,000, some focused on single NFT accumulation, while others built diversified portfolios; most whales choosing to accumulate with a fund scale of $100,000 to $250,000 had varying costs for the NFTs they accumulated.
By reconstructing the accumulation of specific whales, it was found that their strategies had some commonalities, such as: buying in batches, buying more as prices drop, and each having their own "tricks" for accumulation.
From June 7 to June 18, the crypto market and NFTs plummeted, and this week, the NFT market is gradually rebounding. So, which NFTs did the whales accumulate at the market low, and what strategies did they adopt? Which whales participated in this low-point buying, and what are the whale accumulation combinations and average accumulation prices? At the market low, trading volume increased. Since the beginning of this year, the crypto market has been in a downward trend. In the last two weeks (June 7 - June 18), the price of BTC continued to fall, with a drop of over 40% in two weeks. Affected by Celsius, ETH also briefly fell below $1,000.
BTC Market Cap, Data Source: CMC
Similarly, the NFT market was affected, and recently the trading volume on OpenSea has shown a downward trend, but we observed unusual trading volume during the period from June 7 to June 18. Despite the downward trend, the NFT market still generated a brief surge in trading, with a significant amount of turnover, which is why we selected this time frame for analysis.
OpenSea Trading Volume Trend (6.7 - 6.18), Data Source: NFTGo.io
Which NFTs Did the Whales Accumulate?
Top Ten NFTs by Whale Purchase Quantity
After observing thousands of whale wallets, we first focused on the top ten NFTs by whale purchase quantity. Notably, the top-ranked Otherdeed saw a total of 173 purchases by whales, with an average purchase price of 6.22 ETH, equivalent to $9,410; the tenth-ranked Bored Ape Yacht Club had 25 purchases, with an average purchase price of 135 ETH, equivalent to $179,849.
In addition to blue-chip NFTs, we also saw some non-blue-chip NFT projects mixed in, such as the second-ranked tubby cats by tubby collective, with 104 purchases by whales. A deeper look at the on-chain data shows that most of these NFTs were bought in bulk by a single whale, possibly because the whale was absorbing chips and laying out a position. Most whales continued to execute their NFT trading strategies even when BTC fell by 40%. Top Ten NFTs by Whale Purchase Quantity (June 7 - June 18)
Top Ten NFTs by Whale Purchase Funds, Data Source: NFTGo.io
By calculating the purchase quantity * the price at that time (USD), we derive the top ten NFTs by whale purchase funds, which seems to align more with the consensus of the NFT market. From June 7 to June 18, despite BTC nearly halving, the whale group alone purchased $4.5 million worth of Bored Ape Yacht Club, $1.88 million of CryptoPunks, and $1.72 million of Otherdeed.
It is noteworthy that the top three are still NFTs from Yuga Labs, and the purchase amount of the first-ranked Bored Ape Yacht Club is greater than the combined amounts of the second and third ranks, indicating that the whales' purchasing preference during the market crash was: Bored Ape Yacht Club > Other NFTs from Yuga Labs > Other blue-chip and emerging projects.
Top Ten NFTs by Whale Purchase Funds (June 7 - June 18), Data Source: NFTGo.io
Which Whales Engaged in Accumulation?
Due to significant price fluctuations of ETH during this period (June 7 - June 18), we chose to observe which whales had the highest purchase amounts in USD.
Super Whales Purchasing Over $500,000, Data Source: NFTGo.io
As shown in the figure above, there were five super whales who purchased NFTs for over $500,000. The top three had relatively singular types of NFTs, for example: the first-ranked btok1024.eth bought only one Bored Ape Yacht Club for 1024 ETH, which is a rather extreme case. The second-ranked franklinisbored.eth purchased 7 Bored Ape Yacht Clubs, and the third-ranked n0b0dy.eth bought 17 Otherdeeds.
Starting from the fourth-ranked whale, the accumulation of NFTs began to diversify, choosing a combination of [2 Meebits + 6 Doodles + 9 Bored Ape Kennel Clubs + 3 Bored Ape Yacht Clubs + 5 Clone X + 2 Moonbirds + 2 Otherdeeds]. The fifth-ranked whale chose [4 Murakami.Flowers + 4 Bored Ape Yacht Clubs + 2 Clone X].
Top Five Super Whales' NFT Purchases, Data Source: NFTGo.io
Among the whales with a purchase scale of over $50,000, besides the top five super whales, the majority chose to accumulate with a fund scale of $100,000 to $250,000, totaling 16. The NFTs they selected based on accumulation fund amounts were Otherdeed, Bored Ape Yacht Club, CryptoPunks, Art Blocks, and Clone X, with average accumulation prices of $152,373.8, $82,259.15, $35,753.61, $24,962.94, and $15,214.22 respectively.
Distribution of Whales by Different Accumulation Fund Scales, Data Source: NFTGo.io
(Accumulation Fund of $100K - $250K) NFTs Purchased, Data Source: NFTGo.io
Average Accumulation Price of Whales (Accumulation Fund of $100K - $250K), Data Source: NFTGo.io
What Strategies Did the Whales Use for Accumulation?
Among the top ten whales by Otherdeed purchases during the selected time, the top whale bought 55 Otherdeeds, spending 112.97 ETH, which, when converted at the purchase price, totals approximately $160,000. As of June 21, the floor price of Otherdeed was 2.4 ETH, and this whale had an unrealized profit of 19.25 ETH, yielding a 17% return. Let's see how he completed the accumulation with $160,000.
Ranking of Otherdeed Whale Purchases (June 7 - June 18), Data Source: NFTGo.io
Starting from June 7, as the floor price of Otherdeed gradually decreased, this whale began to accumulate. From June 7 to June 8, he first bought 6 Otherdeeds at prices close to the floor price, with an average of 2.596 ETH. On June 9, when the floor price of Otherdeed fell below 2.5 ETH, he again purchased 10 Otherdeeds at an average of 2.368 ETH, reducing the short-term holding cost to 2.45 ETH. On June 12, as Otherdeed accelerated its decline to 1.8 ETH, he completed the last batch of short-term accumulation, purchasing 39 Otherdeeds at an average of 1.89 ETH, bringing the total short-term holding cost down to 2.05 ETH.
Purchase Interval Chart of the Top Otherdeed Whale, Data Source: NFTGo.io
Otherdeed Price Trend Chart (6.7-6.18), Data Source: NFTGo.io
Overall, his strategy was to gradually increase positions: the greater the decline, the more he bought, dividing the purchase prices into three intervals: 2.5 - 2.7 ETH, 2.3 - 2.5 ETH, and 1.7 - 2 ETH, with respective purchase quantities of 6, 10, and 39, keeping the overall cost around 2.05 ETH. Notably, when the price of Otherdeed began to rise from June 13 to June 15, he did not simply rest on his laurels but chose to continue buying, indicating that this whale had his own valuation judgment for this NFT, believing that the price was still within his "accumulation range," so even after the lowest price point, he continued to purchase.
Interestingly, out of the 55 accumulation attempts, he made 34 purchases through offers and 21 through direct purchases, which is a "little trick" for his accumulation, also indicating that during a downward trend, the probability of people accepting "offer prices" increases. Looking at the specific trend of Otherdeed, on June 13, the floor price of Otherdeed dropped to a minimum of 1.8 ETH, while the trading volume reached a relative peak, confirming that besides the whales, many others also chose to "accumulate" Otherdeed at this point.
Otherdeed Price and Trading Volume, Data Source: NFTGo.io
Now let's look at the whale with the most BAYC purchases from June 7 to June 18 and how he conducted his "accumulation." Starting from the price on June 7, when the BAYC price dropped by 10%, he chose to buy 1; on June 13, when the BAYC price dropped by 20%, he began purchasing again, buying 5 in the range of 20% - 30% drop, controlling the short-term cost at 80 ETH. On June 14, he purchased a rare top 10% BAYC from LooksRare for 120 ETH.
Purchase Interval Chart of the Top BAYC Whale, Data Source: NFTGo.io
BAYC Price Trend Chart (6.7-6.18), Data Source: NFTGo.io
This whale used a segmented approach to accumulate BAYC at the floor price, purchasing based on the price drop. For every 10% drop, he bought one, and in addition, he categorized the accumulation based on different rarities of NFTs. From the above analysis, we can summarize a few points regarding whale accumulation logic.
For individual NFTs, purchase in batches according to intervals (3 batches), buying when entering their valuation range.
Purchase based on price drops rather than time; the greater the drop, the more they buy.
Try using offers for accumulation.
For large blue chips, categorize by rarity for accumulation, and for new blue chips, diversify the accumulation.
Consider multiple platforms like X2Y2 and LooksRare, not just limited to OpenSea.
Note: This article is for research purposes only. The views and opinions expressed are solely those of the author and do not necessarily reflect or represent the views and opinions of NFTGo.io. Investing in digital assets (such as NFTs and digital assets) carries risks. Please consult a financial advisor before making any investment decisions. NFTGo does not provide investment advice and is not responsible for any losses incurred from investing in digital assets.
