Two long-dormant Bitcoin wallets holding a combined 20,000 BTC—worth over $2 billion at current prices—were reactivated today.
These wallets transferred their balances to new addresses, sparking fears of long-term holder capitulation.
Two Dormant Bitcoin Wallets Move $2 Billion in BTC
BeInCrypto reported earlier that on-chain sleuth analytics platform Lookonchain identified the source of one of the transfers: a wallet created on April 3, 2011, when BTC was trading at just $0.78.
At the time, the owner acquired 10,000 BTC for under $7,805. The wallet remained inactive for over 14 years until the early hours of July 4, when the full balance was moved to a new address.
Lookonchain also found a second wallet from 2011 with a similar 10,000 BTC balance, making an identical move. Historically, such movements have preceded selloffs from long-term holders, prompting swift and cautious responses from market participants today.
Bitcoin Market Reacts
Many traders have scaled back their activities in anticipation of potential whale liquidations. This growing hesitation is reflected in BTC’s trading volume, which has plummeted 15% in the past 24 hours to $46 billion.
BTC Price/Trading Volume. Source: Santiment
A decline in trading volume alongside a price drop indicates weakening market conviction. In such cases, sellers dominate. This dynamic can set the stage for further BTC declines, as low volume often means less liquidity, making the coin’s price more sensitive to large sell orders.
Furthermore, BTC’s price has dipped by roughly 1% amid the drop in trading volume. But, this decline comes alongside a rise in futures open interest (OI), signaling that traders are still placing leveraged bets despite reduced spot market participation.
At press time, this is at $76 billion, a 1% rise in the past day.
BTC Futures Open Interest. Source: Coinglass
Rising OI during a period of low volume and falling prices often suggests an influx of speculative positioning, particularly from short-sellers anticipating further downside. This setup increases market fragility, increasing the likelihood of liquidation if price volatility increases.
With this setup, even small BTC price swings can trigger significant stop-losses or margin calls, increasing the downward pressure on the coin’s price.
Bitcoin Price Hangs in the Balance
At press time, BTC trades at $108,978, hovering just below its recent highs. However, the market remains on edge following today’s movement of 20,000 BTC from the whale wallets.
If a significant portion of these coins are deposited onto exchanges and sold, it could intensify bearish pressure and push Bitcoin’s price down toward $106,295.
BTC Price Analysis. Source: TradingView
Conversely, if the whales opt to hold and broader market sentiment turns bullish, the coin could find fresh upward momentum. A decisive break above $109,267 may pave the way for a rally toward the $110,422 mark.
Disclaimer
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