Last week, long-term holders finally stopped liquidating more than 178,000 Bitcoins (BTC) below the $23,000 price levels. Market analysts are asking investors to maintain cautious optimism after the recent rally. On the other hand, the global macro outlook is still not in good shape.
Key events and on-chain data to watch for Bitcoin
Last week was another brutal correction week for Bitcoin investors! Last weekend, the BTC price plunged below $18,000 amid major liquidations that took place. The liquidity crisis for the crypto markets does not seem to be over anytime soon. After Celsius Network, Solana-based decentralized protocol Solend is facing another liquidity crisis.
As you follow on Kriptokoin.com, Bitcoin partially recovered from Saturday’s low. However, investor confidence seems low for now. As of press time, BTC is trading up 1.7% at a price of $9,963. Its market value is at the level of 381 billion dollars.
There have been some significant developments on-chain as Bitcoin goes into capitulation, purges of miners, and long-term holders book losses. Also, global macro developments will continue to weigh heavily on decision making about BTC momentum.
On-chain important developments for Bitcoin
On-chain data provider Glassnode reports that the past three days have witnessed the largest loss of USD-denominated Bitcoin in history. “Over $7,325 billion in BTC loss has been locked in by investors spending the accumulated cryptocurrencies at higher prices,” the statement says.
Last week, long-term holders sold 20K-36K Bitcoin per day. This usually includes holders holding cryptocurrencies in the first half of 2021 or before. Below $23,000, Bitcoin long-term holders have sold 178K Bitcoins. That is 1.31% of their total assets. However, total BTH holdings fell to September 2021 levels. Glassnode explains:
A few Bitcoin LTH even bought $69k. It closed at a -75% loss, selling bottoms at $18,000.
After strong accumulation over the last two years, Bitcoin miners are now on the decline. Last week, Bitcoin miners liquidated 9,000 Bitcoins from their treasury. They currently hold around 50,000 BTC. With each drop, Bitcoin is slowly getting closer to block production costs for miners.
What do crypto experts think?
Some market experts are asking investors to maintain cautious optimism. Bitcoin’s drop below $20,000 and 2017 highs is not a good sign. Of course, it’s possible that the last price drop was due to forced sellers. Arthur Hayes, former CEO of derivatives trading platform BitMEX, writes:
Money markets are closed for the weekend. Meanwhile, BTC tumbled to $17,600, down almost 20% from Friday, with good volume. It smells like a compulsive seller triggered a stop expedition.
He also added that the recovery could come soon due to forced selling. However, he sees the selling pressure likely to continue. On the other hand, the crypto market is seeing some big players facing major liquidity issues. Popular investor Mike Alfred says:
Bitcoin is not liquidating the big players. They will lower it to a level that will deal maximum damage to the most affected players, such as Celsius. Then these firms will suddenly jump after they are completely destroyed. It will go higher. A story as old as time.
General macro view
The largest US indices faced a 20-30% correction from their peaks amid the massive price correction since May. However, it seems like the worse is over. Welt analyst Holger Zschäpitz explains:
There is no place to hide. Stocks and bonds together are on track for the worst quarter ever. Meanwhile, credit markets also took a hit. BTC has lost more than two-thirds of its value since reaching around $70,000 in November.
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