Unusual blockchain data appears to show large blocks of bitcoin worth more than $200 million moving for the first time in years, leaving crypto analysts scratching their heads and agonizing over what to do – if anything.
On August 28, according to a post from crypto data analysis platform CryptoQuant, 5,000 BTC were traded that hadn’t been moved in at least seven years. The next day, LookIntoBitcoin’s data tracker showed another 5,000 BTC transferred again.
Analysts say the trading data is insufficient to draw meaningful conclusions and there is no hard evidence about why the currencies moved. It is possible that a long-term holder will want to exit the market, even with bitcoin prices around $20,000, which is quite far from the all-time high of almost $69,000. Or it might just be the owner making some administrative changes to the account status.
“Definitely not a bullish sign,” CryptoQuant said. “It’s hard to say what impact it will have.”
Antoine Le Calvez, chief blockchain data engineer at Coin Metrics, also noticed the transactions. He suggested that the coins are somehow related to cryptocurrency exchange Kraken.
“From most likely to least likely, an old Kraken cooling address, a Kraken OTC (over the counter) deal, a Kraken user,” he told CoinDesk in an email.
Kraken did not immediately respond to a request for comment.
It has long been a spectator sport in crypto to watch bitcoin move for a long time in idleness. In May 2020, the market was briefly rocked by speculation that Bitcoin founder Satoshi Nakamoto might be moving around a small lot of the cryptocurrency. Wallets tagged with Nakamoto – who has never been definitively identified – are closely monitored by crypto analysts. Its hoard is so large that if liquidated, the price of bitcoin would plummet.
This is not the first time this year that large inactive BTC transactions have been detected. CryptoQuant’s post stated that more than 10,000 BTC were moved when the BTC price was at $47,700 in March, 2,800 BTC were moved in May, and more than 1,100 BTC were moved at $23,000 per coin in July.
“The broader trend among addresses holding between 1,000 and 10,000 BTC has been to increase their holdings over the past month, with their total balance increasing by 35,000 BTC,” Lucas Outumuro, head of research at IntoTheBlock, told CoinDesk.
The price of Bitcoin
In theory, keeping coins in different wallets could help investors manage their portfolios more efficiently during periods of high market volatility, and industry experts said it didn’t seem too unusual for wallets of this age to move.
“We regularly see early bitcoin wallets like this go live,” Kim Grauer, director of research at Chainalysis, told CoinDesk in an email.
It could also be that the bitcoin market has matured to the point where major macroeconomic developments such as Federal Reserve rate hikes, inflation reports or the August jobs report may have a greater impact on the price of bitcoin from a pair of single and unexplained data points.
IntoTheBlock’s Outumuro said bitcoin data may be “secondary to short-term correlations as there is less liquidity in the system.”
For what it’s worth, the recent currency moves occurred shortly after Federal Reserve Chairman Jerome Powell said last week that the central bank would likely continue an aggressive campaign to reduce soaring inflation — a stance that in turn could to maintain downward pressure on risky asset prices. , from stocks to cryptocurrencies.
BTC price fell below $20,000 after Powell’s speech. It was recently trading at around $20,300.