- Another Bitcoin whale has activated its wallet after 12 years.
- The wallet awakening has sparked concerns about a potential sell-off.
- Should market participants brace for impact with only a few weeks left to the halving?
Bitcoin’s recent surge to its new all-time high has turned heads and set alarms ringing throughout the crypto community. Amidst the market’s historic rally, patient whales, who have been in a deep slumber for years, are finally waking up to the action.
As Bitcoin once again breaches the $70,000 mark, a dormant wallet has emerged from the depths, ready to make waves in the market.
Bitcoin Whales Awaken
A dormant Bitcoin wallet, which had remained inactive for nearly 12 years, recently startled the crypto market by transferring its entire stash of 500 bitcoins, now valued at $35 million, to multiple new addresses.
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The wallet initially acquired 500 bitcoins in 2012, when Bitcoin’s value was a mere $8, making the total investment less than $4,000 at the time. The identity of the person behind the Bitcoin transfer remains unknown, as is the reason for the transfer.
Still, given the scale of the transaction, there lingers a fear of the wallet potentially preparing for a sell-off, possibly timed before the upcoming halving slated for April 19. Historical data suggests that Bitcoin prices have typically experienced an 18% drop a few weeks before the halving. However, experts posit the event is priced in, and a significant sell-off is unlikely.
Bitcoin Sell-off Looming?
Earlier this month, Bitcoin briefly flirted with the $60,000 mark and wiped out a significant position of its accumulated open interest. Should the dormant wallet choose to liquidate its holdings, it could introduce turbulence into the market, similar to the events witnessed earlier this year.
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When Bitcoin first hit $69,000 this year, Satoshi-era bitcoin miner wallet sold over $500 million worth of bitcoins in a single day, causing its price to plummet from $69,000 to $58,000. However, soon after, the subsequent demand from Bitcoin ETFs alleviated the selling pressure, propelling Bitcoin to a new all-time high of $73,000.
Expert analyst and CryptoQuant founder Ki Young Ju highlighted the sudden surge in whale transactions as a ‘sell-side liquidity crisis,’ potentially spurred by demand from new spot Bitcoin exchange-traded funds in the United States.
Interestingly, large-scale transactions like this have become increasingly common since Bitcoin surpassed its previous all-time high of $69,000. Numerous dormant wallets, including the fifth largest Bitcoin address, have begun to stir, signaling a potential awakening of the whales as they prepare to reposition their funds and move the markets with it. Last weekend, the fifth largest Bitcoin address moved over $6 billion worth of bitcoins to three new addresses.
On the Flipside
- Bitcoin currently produces around 900 bitcoins every day. This number is expected to drop to 450 after April 19.
- There is no evidence to suggest that the moved Bitcoins have found their way to exchanges.
Why This Matters
Whales can have a very lasting impact on the market, given the scale of their holdings. Following the movements of large-scale wallets can help analyze market conditions further and brace for any turbulence should they decide to stir the market.
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