According to latest data from an on-chain analytics website, another big Bitcoin whale has moved its crypto to an exchange raising fears of another price dump. The largest digital currency by market capitalization suffered a setback just last week when big reserves were suddenly added on crypto exchanges and traders went on a selling spree following it, taking the index down to $42k before subsequent recovery.
Whales are big holders of Bitcoin and their coin movements can directly affect the available supply on major cryptocurrency exchanges. Up until recently, the amount held by whales and long-term HODLers was near record high levels. However now, on-chain analytics show that at least some new whale coins have re-entered the exchange wallets and thus are probably looking to sell at least part of their Bitcoin.
According to CryptoQuant, a major on-chain analysis website, new whale deposits are increasing for sure. It has a statistic that it uses to determine this behaviour called the Exchange Whale Ratio which is the size of largest inflows and outflows from exchanges to the total number of inflows and outflows. Just before the massive price dump to $42k, the said ratio reached a high of 0.95, showing huge deposits were being made into the exchange platforms, resulting in an overflowing supply that probably resulted in the price dump itself.
According to CryptoQuant:
“Whales are still depositing BTC to exchanges. Exchange Whale Ratio reached over 95% again,”
It also noted that open interest on derivatives exchanges had fallen and the Taker Buy Sell Ratio had also taken a hit, showing that the market sentiment was bearish overall. Altcoins also fell heavily and followed Bitcoin into a deep bearish curve but they did come out of the whole ordeal in a better shape than the premier cryptocurrency.
The recent downtrend in the crypto indices isn’t an isolated occurrence. Around the world, markets are down and they are expecting more and more downside to occur before some stabilization can happen. While the crypto sector overall didn’t exactly correlate with other markets, the investment pressure also hit on it and now, the continuation of the bull run, at least during this month is in jeopardy. The bulls need to make a strong comeback supported with both on-chain and off-chain statistics and only then can they wish to achieve this extraordinary manoeuvre to turn things around in their favour.
Image Source: Pixabay.com
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