The US Government has moved a significant amount of Bitcoin to Coinbase Prime, totalling 15,940 BTC. The worth of these Bitcoins is approximately $966.4 million. This transfer happened in three separate transactions throughout the year, according to data from Lookonchain.
BTC Falls 5% After Government’s Major Transfers
The first two transactions happened one after another within a short interval. However, within three days after these transfers, the value of Bitcoin declined slightly by 5%. After each of the first two transfers, the price dropped but there is no causal evidence that directly connects the transfers to the price change. However, it can still be expected that BTC may fall below $56k during this weekend.
The large transfer of Bitcoin to Coinbase Prime can be considered as a large scale of transferring cryptocurrency from the government and exchange for a larger exchange. Coinbase Prime is a trading platform for institutional clients, meaning that these could be Bitcoins ready for further trading or investment by these large market participants.
Big Bitcoin Moves Show Potential Market Impact
While they provide investors with a large amount of cryptocurrency for trading, they can sometimes lead to shifts in market sentiment and prices. However, although the price declined after the transfers, it is unknown whether these transactions instigated the changes in prices or if there were other factors involved.
Lastly, this implies that large transactions of Bitcoin, as reported by Lookonchain, may affect the market price of the currency. The fact that the mentioned Bitcoins were bought by using Coinbase Prime that is the special platform for institutions means that these Bitcoins could be used for active trading or investing. In a way, this development demonstrates a highly significant implication of major institutional or government actions in the dynamics of cryptocurrencies.
Source: https://blockchainreporter.net/us-government-transfers-966-million-in-bitcoin-to-coinbase-prime/