Bitcoin Whale Moves $5.4 Billion, Market Reacts
A dormant cryptocurrency wallet, inactive for over 14 years, made waves on Friday by transferring 50,000 Bitcoin (BTC) in a single day. The transaction, valued at approximately $5.4 billion, captured the attention of the crypto community. The movement originated from a wallet address linked to an early Bitcoin miner.
Concurrently, Bitcoin’s price experienced a pullback during the American trading session, declining nearly 2% to trade around $107,578 at the time of reporting. This dip follows an impressive surge to $110,530 on Thursday, but the upward momentum faltered, reflecting a cautious market sentiment.
Miner’s Holdings and Market Impact
Unconfirmed reports suggest the Bitcoin miner held 161,326 BTC associated with the same address. Following the transfer of 50,000 BTC in multiple transactions, the remaining 120,326 BTC has yet to be moved since its accumulation over a decade ago.
CryptoQuant confirmed the significant transfer of 50,000 BTC on Friday, surpassing the previous largest single-day transfer of 3,700 BTC. “Some coins originate from early miner block rewards,” CryptoQuant stated.
As Bitcoin’s price weakens, increased volatility could extend the decline into the weekend, especially if investors reduce their exposure in anticipation of further price drops. Uncertainty in the macroeconomic environment remains a concern, particularly with the approaching end of the 90-day tariff pause announced by former U.S. President Donald Trump on July 9.
Trading volume momentum has decreased since early June, with the monthly average falling to $5.9 billion, according to Glassnode. Despite the decline, trading volume remains 7% above the annual average of $5.5 billion.
“This modest premium suggests weakening investor interest and slowing network activity despite price consolidation,” Glassnode noted.
Technical Outlook: Will Bitcoin Reach New Highs in July?
Bitcoin’s price exhibits a bearish technical bias, having broken below the descending trendline it surpassed on Thursday, as indicated on the 8-hour chart.
The Moving Average Convergence Divergence (MACD) indicator recently confirmed a sell signal, suggesting the pullback could extend into the weekend.
The 50-period Exponential Moving Average (EMA) at $106,827 and the 100-period EMA at $105,896 are positioned to absorb upward pressure if the decline accelerates.
However, an immediate trend reversal cannot be ruled out, especially with consistent demand from institutional investors through spot Bitcoin Exchange Traded Funds (ETFs) and Bitcoin treasuries.
Cryptocurrency Metrics – Frequently Asked Questions
The total number of tokens that can be mined or issued for each cryptocurrency is determined by the developer or creator. Only a certain number of these assets can be mined, staked, or created through other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its creation, a total of 19,445,656 BTC have been mined, which is the circulating supply of Bitcoin. On the other hand, the circulating supply can also decrease through actions such as token burning or mistakenly sending assets to addresses on other incompatible blockchains.
Market capitalization is the result of multiplying the circulating supply of a particular asset by its current market value. In the case of Bitcoin, the market capitalization in early August 2023 was over $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the price of Bitcoin, which was around $29,600.
Trading volume refers to the total number of tokens of a specific asset that have been traded or exchanged between buyers and sellers within a set trading schedule, for example, 24 hours. It is used to measure market sentiment, this metric combines all volumes from centralized and decentralized exchanges. Increased trading volume often denotes demand for a particular asset, as more people are buying and selling the cryptocurrency.
The funding rate is a concept designed to encourage traders to take positions and ensure that the prices of perpetual contracts match those of spot markets. It defines a mechanism of exchanges to ensure that future prices and periodic price payments converge regularly. When the funding rate is positive, the price of the perpetual contract is higher than the market price. This means that traders who are bullish and have opened long positions pay traders who are in short positions. Conversely, a negative funding rate means that perpetual contract prices are lower than the reference price, so traders with short positions pay traders who have opened long positions.
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