The past few days have seen a curious development in the Bitcoin market. Large investors, often referred to as “whales,” have significantly reduced their trading activity. This slowdown coincides with a drop in Bitcoin’s price, falling below the critical $63,000 mark.
Data analytics firm Santiment reports a 42% decrease in whale transactions (exceeding $100,000) over a two-day period, dropping from 17,091 to 9,923. This shift in whale behavior comes amidst a price decline, with Bitcoin slipping from $64,685 to $62,531 at the time of writing (according to CoinMarketCap).
The pullback extends beyond spot trading. Ki Young Ju, CEO of CryptoQuant, observed a shift towards “risk-off mode” among whale traders on derivatives exchanges. This bearish sentiment is reflected in the inter-exchange flow pulse (IFP) turning “red.” The IFP tracks Bitcoin movements between spot and derivative exchanges, serving as a gauge of market sentiment. A red IFP indicates an increase in traders withdrawing their Bitcoin from derivatives exchanges, platforms used for making financial contracts based on Bitcoin’s future price.
Further dampening the mood, the Crypto Fear and Greed Index, a barometer of overall crypto market sentiment, has dipped to “Neutral” territory at 51. This marks the lowest level in 51 days, coinciding with Bitcoin’s fall below the crucial $60,000 support level.
Spot Bitcoin exchange-traded funds (ETFs) have also seen outflows over the past week, with the largest single-day outflow exceeding $226 million on June 13th (according to Farside data).
However, not all analysts are painting a bleak picture. James Check, lead analyst at Glassnode, believes the Bitcoin Sell-side Risk Ratio suggests it’s time for a market shift. He argues that potential profit-taking and selling have likely run their course, and Bitcoin needs to establish a new price range to reignite strong emotions – fear, greed, panic, or euphoria – in the market.
Also Read: Crypto Market Blues: Will Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) Bounce Back?
Whether this whale retreat signals a deeper market correction or a pause before a rebound remains to be seen. Only time will tell if Check’s optimism proves true, or if Bitcoin enters a period of prolonged consolidation.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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