The Truth about Oldest Bitcoin Whale Cashing Out
Quick overview
- A Bitcoin whale reportedly dumped $1.24 billion in BTC, causing panic among investors.
- The initial report was based on a fake screenshot, which misrepresented routine transactions from Coinbase as a historic sell-off.
- Bitcoin has seen a significant decline, losing nearly 50% since October, but analysts believe it will eventually recover.
- Current market conditions suggest it's a better time for new investors to buy rather than for existing holders to sell.
It started with a screenshot from the Arkham cryptocurrency exchange that showed that a Satoshi-era Bitcoin whale had cashed in their holdings, and investors panicked.
News broke this week that one of the oldest Bitcoin (BTC) whales had dumped $1.24 billion in BTC at a time when the price was around 50% below its all-time high. Was this legitimate news or had the data been manipulated?
BTC/USDIt turns out that the screenshot from Arkham was faked. The screenshot originally came from Coinbase and was actually a hot wallet that the exchange used to process transactions.
Routine Event Turned into Historic Moment
What happened is that someone altered a set of routine transactions for withdrawals and deposits and made it look like a historic dumping of assets from an account as old as 2009. The transactions shown on the account were very typical of the Coinbase exchange and are carried out frequently while the supposed cashout would be a once-in-a-lifetime event.
The news from the original story broke across the internet at an alarming rate, scaring investors and analysts that an original whale had mysteriously folded at the wrong time. The story left insiders scratching their heads and wondering why anyone with that much Bitcoin on the line would cash in when the market was in a state of bearish decline.
Bitcoin has lost 4.9% in the last week and nearly 50% since October. Now down to $64,430 (BTC/USD), Bitcoin is trapped in a bearish trend that has yet to find the bottom. It would be unwise for anyone to dump their bitcoins at this time when they should be waiting out a future price increase. However, if the coin never recovers, then it would be better to dump now than later on.
That was the worry when the initial story spread- that Bitcoin was not going to recover and long-standing whales were clued in somehow. That is not the case, however, and now that the story has been exposed as fake, investors can breathe a sigh of relief.
Typically, veterans do not leave the market during a low point in the cycle. Instead, they will typically wait out low cycles and cash in at least part of their assets during high periods when it makes the most sense. Long-time holders typically have the ability to wait out ebbs to make the most of their holdings, and now the market can see that is what is happening for now with very little change in the coin’s trade volume for Tuesday compared to the previous day.
Most analysts agree that Bitcoin will recover, but it may take a while. This is a great time for new investors to buy in at a low price but a poor time for current coin holders to cash in.
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