Dormant Bitcoin of over seven years is on the move for the fourth time this year.
Crypto analysis firm, CryptoQuant, in its on-chain analysis Quicktake, shared today, reveals that 5,000 BTC with an age of approximately 7 to 10 years was spent in a single block, noting that this move could lead to further downside or consolidation in the market.
“… it’s hard to say what impact it will have on the market. It is definitely not a bullish sign, but I’m not sure if we will see further downside or just consolidation,” CryptoQuant analyst Maartun writes.
As highlighted by CryptoQuant, it bears mentioning that this is the fourth time such a transaction has happened this year. Notably, there was a Bitcoin price correction each time, with the price ranging for a month first before moving lower after a similar transaction in May.
Maartun compares the transaction which occurred yesterday to that of May, which saw 2,800 BTC moved. However, the author notes that, unlike the transaction in May, the latest transaction has not been sent to an exchange. Notably, at press time, a poll by CryptoQuant reveals that 92% of investors see the news as bearish.
Weekend Panic
It is worth noting that the crypto markets had a rough weekend, first showing signs of significant weakness after Fed chair Jerome Powell revealed plans to continue to raise rates. Additionally, rumors that the now-defunct Bitcoin exchange Mt. Gox was preparing to release about 137k BTC into the markets in client repayments further heightened the market panic.
For the uninitiated, Mt. Gox, over a decade ago, was a leading crypto exchange that, at one point, handled 70% of all Bitcoin transactions. However, it all came crashing down when the exchange lost about 850k BTC in a hack in 2014. As part of a long legal procedure to repay creditors, with about 140k BTC recovered, Nobuaki Kobayashi, the rehabilitation trustee, revealed in July that preparations are being made to repay creditors, giving the end of August as a tentative date for payments to kick off.
The potential release of such a large cache of Bitcoin has made the markets uneasy. The prevailing speculation is that the creditors are likely to sell their holdings as their original investments in 2014 have grown about 42x at current prices. However, one of the creditors, Eric Wall, has noted that the rumors of the repayments are false, noting that the repayments system has not been launched yet.
PSA: MtGox is *NOT* distributing any coins this week, or the next week, or the week after that.
Source: I’m a MtGox creditor. The repayment system is not live yet.
Next step: Go and block @TheAltcoinHub for spreading this misinfo.
— Eric Wall (also supports X ?) (@ercwl) August 27, 2022
Market Outlook
It is worth noting that, as highlighted by CryptoQuant going into the weekend, Bitcoin is once again below its realized price of $21,700. While the analytics firm notes that it is a good zone for accumulation, it warns that the market is yet to form a bottom as certain, albeit positive, metrics are yet to mature.
Meanwhile, Santiment Feed noted that we could see a market bounce as shorts pile up.
? Traders are now #shorting the markets after #JeromePowell‘s #hawkish statements on the US economy. As these bets against #crypto prices come in, the likelihood of a weekend rebound increases.
Open your Sanbase PRO trial to access this powerful model. https://t.co/6nCxWJob9s pic.twitter.com/G8sP3TiWF3
— Santiment (@santimentfeed) August 26, 2022
Bitcoin is trading at the $19,783.30 price point, down 1.08% in the last 24 hours and 7.79% in the last seven days.
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Source: https://thecryptobasic.com/2022/08/29/5000-bitcoin-7-to-10-years-old-is-on-the-move-here-are-the-possible-implications/?utm_source=rss&utm_medium=rss&utm_campaign=5000-bitcoin-7-to-10-years-old-is-on-the-move-here-are-the-possible-implications