Bitcoin

Big owners expect a bigger decline?

A Bitcoin (BTC) whale placed a short position of $ 100 million on Bybit, according to trader named CL. This after several on-chain data suggested a sell-off of whales in the past week.

While momentum continues to be strong for Bitcoin, there are many reasons that make $ 16,000 an attractive area for sellers.

There is significant liquidity at $ 16,000 mainly because it is a high resistance. However, the level has seen relatively high demand from buyers as shown by stable inflows of coins. So, The battle between buyers and sellers at $ 16,000 makes it a highly liquid area that is attractive to sellers.

Bitcoin order book on futures exchanges. Source: CL, Exocharts

Increasing evidence that whales are making a profit

Big owners expect a bigger decline?
Big owners expect a bigger decline?

A seller aggressively sold Bitcoin on Bybit on November 15th. The order flows show that for several hours in a row, customer orders averaged around $ 3.5 million.

Given the large abrupt sell order, CL suggested that this could lead to two scenarios.

First, The seller could be overwhelmed and cause a contraction that could lead to an increase in the BTC price. Second, it could continue to put selling pressure on BTC. The dealer wrote::

“About 2 hours ago someone sold aggressively almost 100 million on Bybit, a third of the turnover is open. Personally, I am very curious to see what happens when this seller / shortlist is overwhelmed or if he is let go.”

Meanwhile, other major exchanges have noted large deposits in the past 24 hours. The US-based cryptocurrency exchange Gemini received a deposit of 9,000 BTC, according to CryptoQuant.

Means of BTC entry into Gemini. Source: CryptoQuant

Whales often use exchanges under strict compliance and regulatory measures, including platforms like Coinbase and Gemini.

Given the large Bitcoin deposit in Gemini, worth $ 143 million, a researcher named “Blackbeard” said What Time to be careful.

Weekend volatility only?

As CL pointed out, the current structure of the Bitcoin market is different from the previous cycle. For example, When BTC was at $ 16,000 in 2017, the extreme volatility market was extremely overheated. The dealer said::

“In 2017, when we went from 10,000, 15,000 to 20,000, we had weekly OKEx futures trades in contangs of $ 1,000. Now we’re here on just $ 100 a quarter.”

This time the rally seems to be more sustainable and gradual. Bitcoin has continued to see a ladder rally over the past six months, allowing it to develop into a sustained uptrend.

Instead of a sudden spike, followed by another steep uptrend, BTC saw a surge, followed by a consolidation and so on.

As Cointelegraph reported earlier this month, various data, including Google Trends, show that retail investor interest is still low compared to late 2017. On the other hand, there is increasing evidence of this Wall Street is starting to take this into account.

So there is a strong argument that the current rally is fundamentally different from 2017, despite the current market sentiment of “extreme greed”. Specifically, The available supply has decreased due to the recent halving and the reserves on the stock exchanges in the past year.

Bitcoin futures funding rates are also neutral at around 0.01%, meaning the market is no longer as overheated or crowded as it was three years ago. This trend could limit the downward trend, especially in the medium term.

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