As a seasoned crypto investor with a few years under my belt, I’ve learned to take market volatility in stride and remain focused on the long-term trend. The recent selloff by whales and miners, resulting in a 9% correction from the all-time high of $71,500, is concerning but not unexpected.
The cost of a bitcoin (BTC) hovers slightly above the $66,000 threshold now, following a sharp decline to $65,000 in the previous week. This slide was initiated by large-scale selloffs from Bitcoin’s prominent investors (whales) and miners. Data from on-chain analysis indicates that these sell-offs resulted in over $4 billion being offloaded from the market. Despite this massive withdrawal, experts maintain a positive outlook regarding Bitcoin’s future price trend.
Analysts Remain Optimistic Despite Selloff By Whales & Miners
Large-scale Bitcoin holders, referred to as “whales,” disposed of around 50,000 Bitcoins within a ten-day span preceding the latest price correction. The value of these transactions amounted to roughly $3.3 billion. Whales are significant players in the market whose trades can impact Bitcoin prices.
Bitcoin miners played a role in the recent price drop by offloading approximately 1,200 BTC, valued at over $79.2 million. These miners generate Bitcoin through validating transactions and appending them to the blockchain. Regularly, they sell their gains to meet expenses.
In spite of recent drops in prices, numerous analysts maintain that the bull market for Bitcoin (BTC) is far from finished. Ki Young Ju, the CEO of CryptoQuant, voiced his perspective on this matter regarding BTC, formerly recognized as Twitter. He remarked, “The average purchase price for Bitcoin traders hovers around $47,000. In a bull market, the value of BTC typically remains above its buyers’ entry points. Although there has been a 27% decrease, it can still be deemed a bull market. Maintain a long-term bullish stance, but exercise caution and minimize excessive risks – this is financial guidance.”
As an analyst, I’d interpret Ki Young Ju’s perspective as follows: Even if Bitcoin experiences a 27% decrease from its present value, the overall market sentiment remains optimistic, implying a bullish trend. Consequently, the recent 9% decline from $71,500 does not signal the demise of the bull market. Instead, I anticipate further price growth in this ongoing bull market.
Crypto analyst Ali Martinez noted that the average cost to mine a bitcoin is presently $86,668. He elaborated, “Bitcoin has consistently risen above its mining cost in the past!” The rise in mining expenses can be attributed to the latest Halving event, which reduced block rewards from 6.25 bitcoins to 3.125 bitcoins.
As a researcher studying the impact of Bitcoin halving events on the market, I’ve discovered that these occurrences lead to a decrease in the number of new Bitcoins entering circulation. This reduction in supply can result in an increase in Bitcoin’s price due to the basic economic principle of supply and demand. However, this situation also means that miners earn fewer rewards for their efforts. In order to cover their expenses, they may be forced to sell a larger portion of their newly minted Bitcoins.
What’s Next For Bitcoin Price?
Martinez posits that the value of Bitcoin is set to exceed its typical mining expense in the near future. Once this occurs, miners may choose to hoard their stash rather than offloading it for sale. Consequently, less Bitcoin might reach the market, thereby potentially intensifying price growth.
As a financial analyst, I’ve been observing the market closely, and I’ve noticed that recent large-scale selloffs by whales and miners suggest short-term profit-taking and cost management strategies. However, it’s important to note that the overall sentiment among analysts remains positive.
At the moment of publication, Bitcoin’s price had dropped by 0.39% to hit $66,004.88 on June 17, Monday. The digital currency boasted a market capitalization of $1.3 trillion. Meanwhile, Bitcoin’s 24-hour trading volume experienced a significant surge of 39.29%, reaching an impressive $16.95 billion. Despite the price moving sideways, long positions were being liquidated more frequently than short ones, resulting in downward pressure.
As an analyst looking at data from Coinglass, I observed that long positions in Bitcoin were liquidated for approximately $5.89 million during the past 24 hours. In contrast, short positions were liquidated for roughly $3.93 million. With longs outpacing shorts, a slight decrease in Bitcoin’s price occurred. However, the buying pressure from shorts helped to mitigate this dip.
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2024-06-17 10:49