thecryptobasic.com
Privacy transactions on the Bitcoin network have skyrocketed over the past two years.
Whales actively use methods like CoinJoin to discreetly accumulate large amounts of Bitcoin. CryptoQuant’s Ki Young Ju highlighted this trend in a tweet. According to the update, the annual average number of CoinJoin transactions has tripled since 2022.
Massive Spike in Bitcoin CoinJoin Transactions
CoinJoin transactions are a method to enhance anonymity by mixing multiple Bitcoin transactions. They have become a preferred tool for large-scale investors, as evidenced by the fact that CoinJoin transactions under 5K were the norm as of December 2022.
However, by December 2023, CoinJoin transactions surged to nearly 40K. The trend continued into 2024, with the average number of transactions remaining around 20K. This development suggests a growing priority on privacy as institutional and individual investors move large amounts of BTC.
Whales Accumulating BTC Discreetly
The spike in privacy transactions coincides with significant whale activity in 2024. Specifically, Young Ju highlighted that 1.55 million BTC flowed into accumulation addresses this year. These addresses are primarily associated with entities such as exchange-traded funds (ETFs), firms like MicroStrategy, and custodial wallets.
Indeed, U.S. Bitcoin ETFs have accumulated over 1.1 million BTC since January, exceeding the holdings of Satoshi Nakamoto. At the same time, MicroStrategy has significantly increased its holdings, now owning over 444,000 BTC.
While some of this accumulation is driven by institutional players, a substantial portion remains in the hands of unidentified whales. Specifically, Ju noted that entities have moved between 240,000 and 420,000 BTC have been to unknown entities.
This has sparked speculation about the identity and intentions of these entities. Nonetheless, this trend confirms the rising adoption of Bitcoin by institutional investors, seeking ways to move funds without drawing attention.
However, not all privacy transactions are above board. Some analysts believe the rise in CoinJoin activity may be due to hackers laundering stolen funds.
Meanwhile, Ju cited Chainalysis reports revealing total hacking-related losses of $2.2 billion in 2024. This figure represents just 0.5% of Bitcoin’s $377 billion in realized market cap inflows.
Ultimately, the surge in privacy transactions highlights how whales and institutions are increasingly prioritizing discretion, whether for strategic purposes or to navigate regulatory scrutiny.