$50 M SHIB transferred in two transactions: What does this mean?

• There have been 2 massive transactions in SHIB, amounting to $50 million
• The exact reason for this is unknown; it might be to boost the price or to get out of the bear market. 
• Exchanges are known to transfer funds internally to maintain liquidity.  

After months of a fearful market, investors seem to be shifting their focus from withdrawing their assets and running away from the market towards getting in and boosting the market. Indicating a similar agreement, two large transactions have been carried out over $50 million. 

On December 8, unknown parties reported large transactions involving SHIB. The said transactions were found to be adding up to $50 million, and this sparked thoughts regarding their reasons. Furthermore, raising the question regarding the future of SHIB and the potential impact of these transactions. 

Crypto Exchanges move funds internally.

Crypto exchanges are well-known for the internal shuffling of their funds. They move their funds, quite often, between their wallets for various reasons. One reason could be liquidity optimization or potential loss protection. These transactions may also help in better execution of trades.

It is quite possible that the said big transfer might be linked to this practice. They might have been repositioning their funds, citing a potential for future market developments or an influx of new investors. It is not possible to be sure whether this was the case. 

Can this be a shift in Investment Strategy?

With these transactions, the involved parties might be shifting their investment strategy by transferring SHIB. It is known that the asset has performed badly in 2022, and the currency is down by 75% overall this year. And the said transfers can be in order to disinherit SHIB. 

This further indicates that the involved parties have no hopes for the future of Shiba Inu. Furthermore, it could be a part of a broader diversification strategy. Basically, spreading their load to a larger surface area so as not to sink in the sand. Unless more data is gathered, it is impossible to be certain about the reasons for transfers. 

If we see these transactions as a bearish signal, this indicates the loss of confidence in SHIB by the investors. If this pessimism continues, it could lead the investors to sell their holdings to minimize the losses. If more investors were to follow suit, it could bring the price further down.

One cannot deny the possibility of bullish investors making the transactions, and they still have hopes that SHIB might have a comeback soon. As the year is coming to an end, some investors might be looking at the opportunity to take a year-end price gain advantage. If such is the case, these transfers could prove to be an optimistic sign about its future. 

Impact of Large Transactions. 

Whatever may be the motive behind these transactions may be, it is undeniable that the movement of such huge amounts attracts the compelling interest of avid investors and users. Such huge transactions tend to have a powerful impact on the price of the cryptocurrency because they indicate a change in sentiments and a shift in the market. 

Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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