After weeks of having a hard time and rapidly declining, bitcoin took off in the previous few days and neared $56k – – its highest cost line because mid-May. Yesterday alone, the cryptocurrency acquired more than $5,000 of value in hours.
While the bulls celebrate, it’s worth exploring prospective reasons that might be and might there be more comparable developments hiding behind the corner.
Factor 1: Whale Purchases
Being an asset with a maximum supply of simply 21,000,000 tokens with a big portion of the existing ones lost or in the hands of long-term holders, the price of BTC might change difficult whenever the so-called whales make significant purchases (or sales).
Data provided by CryptoQuant’s CEO – – Ki-Young Ju – offers a comparable example. The purchase came roughly 24 hours ago – – or just ahead of the $5,000 move. In it, someone (or multiple celebrations) accumulated $1.6 billion worth of bitcoin through market orders in simply 5 minutes, Ju explained.
He added that the short liquidations at that point were still fairly small – – around $17 million – – which makes it most likely that this was a whale purchase instead of “waterfall liquidations.”