Bitcoin and the crypto market is enjoying significant gains but is the position secured or a danger is incoming? Meanwhile, US Dollar is strengthening as gold and Bitcoin fails to offer a safer option that could further affect the market.
Bitcoin alert: Whale movement detected
Bitcoin is doing good, the crypto market is enjoying substantial gains, everything seems to be going at a good pace. At $6,470, Bitcoin is up by over 6 percent while altcoins are surging between 5 to 15 percent.
However, as per the latest news, about 18,000 Bitcoins has been transferred to a wallet that apparently belongs to BitMEX. At the current rate, these coins amount to about $116 million. The transfer took place in a number of transactions.
— KKTHXBYE (@kkkthxbye) August 14, 2018
This consolidation took place just a few hours before Bitcoin made its recovery from dropping below the $6k level. Soon after this happened, people took notice and speculated BitMEX to be involved in market manipulation. But this 18,000 BTC only amounts to about 0.1 percent of the currency circulating supply of Bitcoin.
This kind of ‘Whale” moves always make crypto investors anxious as it is suspected to lead to a sell off. Previously, Mt Gox has consolidated large amounts of cryptocurrencies before selling them in the market that has believed to impact the prices.
A Redditor, DaSpawn shared,
“This is what I find most fascinating about Bitcoin, you can see huge moves in the entire economy, but have no idea who/what/why it is happening and if the entire thing is about speculation some people are gonna have a really bad time unless Bitcoin is used as cash the market can be completely destabilized with whales.”
He further shared,
“when you can create unlimited fiat from above of course those systems will be eventually destabilized. The entire point of Bitcoin is to have a fixed supply and to be used as cash by many people so that whales only make a temporary problem.”
Another Redditor commented,
“This looks like Prep for a Long Position, but it’s hard to be sure.”
US Dollar strengthening, gold & crypto fails to offer a safe haven
Another reason that might have affected the bitcoin prices and could in future as well is the strengthening of Dollar while other national currencies keep on losing.
The plunge in currencies like Rial and Lira have boosted the Bitcoin volume and prices as investors flock towards a safer bet than their depressing currencies as happened in hyperinflation countries like Venezuela.
However, this time as South African Rand and Indonesia’s Rupiah along with other currencies tumble down, investors flee to the safety of the Japanese Yen and US Dollar. The drop in cryptocurrencies failed to provide any safe harbor to these investors looking for a hedge in economic distrust.
Even gold couldn’t keep up as a safety net as it also took a drop except for US Dollar which has been strengthening given the way Trump is heavily imposing tariffs on countries and increasing interest rates.
Moreover, recently, Saudi Arabia declared cryptocurrencies to be illegal while Hungary says cryptos are not a legal payment method, that further affects the sentiments of the market to a degree.
However, today, with the Bitcoin prices and the entire crypto market being in the green, it might soon outperform as investors start feeling positive.
Having a background in writing, I worked on a wide array of industry topics and have recently entered the world of Blockchain and Cryptocurrency.