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This makes me scared
— Ki Young Ju 주기영 (@ki_young_ju) December 10, 2020
Why Miners Moving BTC En Masse Has An Analyst Scared But Could Be Bullish For Crypto
The situation is scary because the Bitcoin could be sold into the market while the cryptocurrency is currently on the ropes from repeating rejections from resistance at $20,000.
A new all-time high was set, and even with all the FOMO in crypto, and a year of mostly positive momentum, miners are instead potentially dumping their holdings.
Why would miners sell now when this is what is supposed to happen next? | Source: BTCUSD on TradingView.com
Making this trend even more confusing, is the fact that the hash ribbons, the cryptocurrency’s most profitable buy signal, just triggered. The tool is theoretically used to tell when miners will be holding BTC for the long haul. Yet BTC is moving en masse.
In an update, Crypto Quant CEO Ki Young Ju, says that only a small portion of the BTC made it to Binance, while the rest of it was moved to an unknown wallet. The wallet is thought to potentially have been moved for the purpose of an OTC deal, where Bitcoin is sold through backdoor agreements in bulk, at slightly below cost.
Whales and institutions use such methods in order to avoid drastically impacting prices, and miners could be moving some of their stores for this purpose behind the scenes as to not tank Bitcoin price.
In this scenario, more whales taking sizable positions in the cryptocurrency could be bullish. But there are of course bearish implications as well, such as the larger portion held in the unknown BTC wallet could just be a stopgap until it too makes its way to an exchange, and is market sold onto FOMOing buyers at prices near all-time high.
Only time will tell which of the scenarios it is.