Despite multiple stock markets reaching new highs, Bitcoin fell below $61,000 today, prompting significant whale selling. Capriole Investments founder believes that current on-chain indicators suggest “signs of weakness” in Bitcoin’s price, signaling that the current bull market for Bitcoin may have peaked.
Many whales have started selling off, contributing to the ongoing slump in the cryptocurrency market. This trend contrasts with the bullish sentiment in global stock markets such as the U.S., Japan, and Taiwan, which saw significant gains following dovish remarks from Federal Reserve Chairman Powell regarding inflationary progress. Nonetheless, Bitcoin’s morning lows dipped to around $60,660, erasing all gains from the previous weekend.
Amidst this downturn, notable whales have emerged to dump their holdings. According to analysts at Yu Xin, a whale/institution that invested in ETH and ETH-related tokens following the approval of Ethereum spot ETF 19-4 documents at the end of May, liquidated various ETH ecosystem tokens worth $11.57 million in the past hour alone on Binance. This move has led to varying degrees of declines in these tokens, including 3.514 million LDO ($6.23 million), 49,700 AAVE ($449,000), and 319,800 FXS ($85,000).
Yu Xin’s analysis indicates that the whale was evidently betting on the Ethereum spot ETF news to boost ETH ecosystem token prices, hence acquiring tens of millions of dollars’ worth of various tokens. Now, having sold all these ETH ecosystem tokens at a loss, this whale seems to have cut losses.
Additionally, The Data Nerd has monitored a significant sale of 6.28 billion FLOKI tokens (approximately $1.1 million) by an early investor, amidst FLOKI’s recent decline of over 30% in the past month. Spoton chain has also noted unusual movements in the PEPE market, where early PEPE buyer dimethyltryptamine.eth sold 10 billion PEPE tokens (approximately $112,000) at a price of 32.73 ETH this morning, turning an initial $45,000 investment into a remarkable $2.67 million (+58600%) achievement.
The persistent downturn in the cryptocurrency market amid Powell’s dovish remarks and record highs in global stock markets has baffled many observers. Several factors contribute to this phenomenon: uncertainty over when and how much new capital an Ethereum spot ETF might bring, speculative hot money flowing more into stocks than cryptocurrencies amidst the AI boom, and concerns over significant Bitcoin sell-offs, such as Mt. Gox’s ongoing Bitcoin repayment process.
While most of the market still judges the bull market not yet ended, Charles Edwards, founder of Capriole Investments, warns that several on-chain indicators suggest “signs of weakness” in Bitcoin’s price, potentially signaling the peak of this bull cycle. Key reasons cited include the nearing critical threshold of Long-Term Holders’ inflation rate, a sharp rise in dormant Bitcoin transaction volumes, and a surge in spending from holders of 7-10-year-old Bitcoins, suggesting increased selling pressure.
Charles Edwards believes that over $9 billion worth of Bitcoin has been transferred from addresses holding over 10 years, partly related to Mt. Gox’s debt repayment preparations, which could increase selling pressure. However, he remains optimistic that with multiple payout options available, the impact of Mt. Gox’s sell-offs could be mitigated.
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