Bitcoin (BTC) recently experienced a significant decline, with its value reaching $42,420, down $9,000 from the previous week. Two major players appear to be influencing this downturn: a mysterious whale and serious selling by Bitcoin miners.
Whale manipulation theory for Bitcoin
Bitcoin’s 15 percent decline from its $49,000 highs since January 11 was initially attributed to a “news sell” event that occurred after the US approved spot exchange-traded funds (ETFs). However, a new theory has emerged that suggests a single whale may have been responsible for the massive decline. In a recent post on X on January 18, CryptoSlate research and data analyst James Van Straten pointed to a massive entity selling BTC. When the realized price of BTC supply was examined, a significant decrease was observed at the peaks. This drop suggests the involvement of an unknown entity that acquired a massive hoard of 100,000 BTC during Bitcoin’s 2021 all-time highs.
Last week, the whale that survived the BTC price crash finally reached balance. The opportunity to sell at $49,000 proved very attractive, potentially resulting in a $100 million profit despite a modest $1,000 difference between the entry and exit points. The impact of this whale sell-off, combined with other factors such as liquidations and ‘selling the news’, triggered a frenzy in the market. Bitcoin miners experienced a significant decrease in their reserves, selling more than 10,000 BTC on January 17. This marks the largest daily decline in miner reserves in more than a year, as reported by on-chain analysis provider CryptoQuant.
BTC reserves are at their lowest
According to CryptoQuant data, Bitcoin miner reserves reached their lowest level since July 2021, remaining at 1.83 million tokens. Despite the decline, reserves remain significant at around $78 billion. Last year, BTC miner reserves decreased by 22,800 BTC. Bitcoin miners often go through phases of accumulation and sale depending on the price and profitability of the cryptocurrency. Recent data shows a drive towards selling, perhaps to take advantage of higher prices during a rally or to replenish cash flow.
The recent decline in miners’ reserves raises questions regarding their outlook for Bitcoin’s short- and medium-term price. The combination of a significant whale sell-off and the largest single-day sell-off by Bitcoin miners reveals the complexity of factors affecting the cryptocurrency market. Investors and market participants will monitor these developments closely, considering their potential impact on price volatility and overall market sentiment.
To be informed about the latest developments, follow us Twitter’in, Facebookin and InstagramFollow on . Telegram And YouTube Join our channel.