- The cryptocurrency market is down 7.74% in the last 24 hours wiping off a whopping $16 billion.
- Fears of Bitcoin whales sending the market to rock bottom are unfounded.
It is a gloomy and sorrowful day in the digital asset market. Prices are in the red following a sharp decline across the board affecting big and small cryptocurrencies alike. Bitcoin erased over 5% of its value in less than half an hour on Thursday 11. The entire cryptocurrency market is down 7.74% in the last 24 hours wiping off a whopping $16 billion. The total capitalization currently stands at $201 billion from yesterday’s $217 billion.
Bitcoin market cap has declined from $114 at the close of the session on Wednesday 10 to $108 at the time of press. On the contrary the trading volume has gone up from $3.7 billion to $4.6 billion in the same period, which explains the selloff. Bitcoin dominance, on the other hand continues to rise and currently stands at 54%. This means that altcoins are shedding off most of their value in comparison to Bitcoin.
The sharp declines rejected several lifeline support areas at $6,400, $6,200, $6,100 including the short-term support level at $6,500. BTC/USD recorded lows of $6,060 allowing bulls to enter and pull up the price above $6,200. It is currently battling to keep above this level while looking forward to the next resistance at $6,250.
Bitcoin whales not to blame for market volatility
A recent research by Chainalysis shows that the holders of large amounts of Bitcoin, commonly referred to as Bitcoin whales are not the reason behind the frequent swings in prices in the cryptocurrency market. The research firm started looking into the activities of the biggest Bitcoin wallets after a report on Bloomberg said that a whale had moved over 15,000 BTC ($2 billion) sending the crypto market into a tailspin that saw Bitcoin drop 15% in a period spanning one month.
For this reason the research firm studied 32 bitcoin wallets and later revealed that the fears of Bitcoin whales sending the market to rock bottom were unfounded. The research stated:
“Our data demonstrates that Bitcoin whales are a diverse group, and only about a third of them are active traders. And while these trading whales certainly have the capability of executing transactions large enough to move the market, they have, on net, traded against the herd, buying on price declines.”
Chainalysis report continued:
“That net activity demonstrates that trading whales were not selling off Bitcoin in any mass amount, but rather were net receivers of Bitcoin from exchanges in late 2016 and 2017. This indicates that trading whales were, in aggregate, buying on declines and, consequently, were a stabilizing, rather than destabilizing factor in the market.”