On Friday, the Bitcoin market saw the awakening of a long-dormant whale wallet after being inactive for six years. According to data by Lookonchain and Arkham Intelligence, the said wallet resumed activity to transfer 1,000 BTC (worth over $61 million) to Coinbase Pro. This movement coincides with a recent downturn in Bitcoin’s price, which has now fallen nearly 9% this month.
Notably, the Bitcoins that were transferred were acquired by the whale some six years ago for a mere $6.68 million. If the holder were to sell now, they would have made over 813% profit on their investment, highlighting the huge potential returns within the crypto market.
Bitcoin Whale Activity Surges as Analysts Weigh In
Meanwhile, this incident is not an isolated one. This second quarter has particularly witnessed a surge in dormant Bitcoin wallets awakening and transferring holdings to exchanges. Just yesterday, a wallet linked to a Bitcoin miner, and has been inactive for 14 years, similarly sent 50 BTC to Binance.
About the sudden activity, analysts have offered various reasons why these long-term holders are coming back to life. Some believe that the whales might be looking to capitalize on the current price levels, which is eyeing record highs, by cashing out their holdings. Others speculate that the movements could indicate a shift towards speculative trading in the derivatives market.
Expectedly, the recent selling pressure from these dormant whales has contributed to the price decline of Bitcoin. That, alongside some other factors such as the faster liquidations by miners and the German government’s divestment of its Bitcoin holdings. As of writing, Bitcoin was trading at $61,510, repeatedly failing to sustain gains above the crucial $62,000 mark.
Also adding to the market’s volatility is the upcoming release of the core Personal Consumption Expenditures (PCE) price index for May. The PCE, which is the Federal Reserve’s preferred inflation gauge, is slated for release later today. While economists anticipate little change in the overall PCE, a higher-than-expected reading could further fuel concerns about inflation and potentially lead to a steeper decline in Bitcoin’s price.
With some analysts predicting a potential slide towards $50,000, it remains to be seen if a benign inflation report can provide support for Bitcoin or if the recent whale activity marks the beginning of a more significant sell-off.
