A Bitcoin (BTC) whale – an individual investor who holds a large amount of BTC – took profit after two years. Whalemap data suggests the whale bought nearly 9,000 BTC in the third quarter of 2018.
A pseudonymous trader known as “Byzantine General”, who shared the data, said:
“This whale is a legend. Do you see this big bubble around 6k in 2018? It’s almost 9k BTC that has accumulated there. He finally took profits, after 2 years and 2 big surrender events.
The whale hung on to the BTC for nearly 22 months, through two major phases of surrender. Bitcoin has fallen twice to below $ 4,000, first in January 2019 and second in March 2020. The investor waited for both periods, eventually selling for around $ 12,000.
Number of Bitcoin held by a whale. Source: Byzantine General, Whalemap
What Does a Profit Taking Bitcoin Whale Suggest?
On August 16, Cointelegraph reported that large clusters of whales are present between $ 12,000 and $ 14,000. At the $ 12,000 level, many whales are either at a profit or at breakeven point, which could arguably prompt the whales to sell.
It is not known if this shows the whales are cautious that Bitcoin has hit a local high. Whales, because of the size of their holdings, track liquidity. If they feel there is enough cash to sell, perhaps due to increased retail activity, they will likely sell.
Therefore, selling a whale does not necessarily show that Bitcoin has peaked. You could say that it increases the chances of consolidation in the short term. But until BTC drops below key support levels, it’s premature to suggest that a local top has formed. In addition, it is difficult to estimate the share of the 9,000 BTC sold by the whale.
One of the reasons some whales appear to be making profits at current levels could be Bitcoin’s relatively high point volume. According to another pseudonym trader known as Bitcoin Jack, the market remains “awkwardly” driven by the cash market. He said:
“The market remains awkwardly guided by the spot for the moment. Market remains relatively high chain dominance So price expansion is imminent again – the direction is unclear, but weak derivatives against spot and spot against chain dominance indicate that we have not seen an irrational summit.
When the market is heavily driven by the derivatives market, whales have less cash to seek out and minor pullbacks could lead to large price movements.
What traders expect in the short term
In the short term, traders remain mixed on sentiment around Bitcoin. Michael van de Poppe, a full-time Amsterdam Stock Exchange trader and Cointelegraph Markets analyst, says BTC could drop to $ 10,000 if it loses $ 11,450. He said:
“It’s pretty easy here because there is a rejection at $ 11,600. If we maintain the area of $ 11,450 to $ 11,500, I think we will have a breakout towards $ 12,000 next week. I lose the green zone and aim for $ 10,700 or even $ 10,000. ”
After a price increase of nearly three times, a phase of short-term consolidation could strengthen Bitcoin’s momentum in the longer term.