The price of bitcoin, the number one cryptocurrency by market cap, has recently dropped over 5.5% to trade at $3,850 in little under 30 minutes. The drop led to a crypto market sell-off that has so far seen $8 billion leave it.
According to CryptoCompare data bitcoin’s plunge was accompanied by significantly increased trading volume, which coupled with the short time frame suggests a whale has sold a large amount of BTC.
As recently covered, a study conducted by China’s state-run publication National Business Daily (NBD) found that less than 1% of all BTC addresses control nearly 87% of the cryptocurrency’s supply. Although the largest addresses belong to cryptocurrency exchanges that hold funds for its users, it noted the existence of ‘whales’ is worrisome for investors, as large orders significantly impact the market.
Before the sell-off, some analysts showed they were bullish on BTC’s future. Jeffrey Gundlach, the CEO of DoubleLine Capital who’s often referred to as the “bond king” has predicted bitocin could “make it to $5,000” for an “easy” 25% gain.
Mati Greenspan, a senior market analyst at eToro, has on social media revealed the $4,000 was never a “really significant level to begin with.” Per his words, the cryptocurrency’s current range is between a support at $3,000 and a resistance at $5,000.
Good to see Bitcoin holding above $4,000…. but this was never really a significant level to begin with.
The current range that we're in is between 3k & 5k, so 4k is just the halfway mark. Only a strong breakout of the range can give us a new direction. pic.twitter.com/bsCllL3YNa
— Mati Greenspan (@MatiGreenspan) January 7, 2019
Speaking to CryptoGlobe earlier this month, Greenspan stated that “If we start heading south again, 3k represents critical support.” According to Bloomberg, the flagship cryptocurrency was on the “brink of a big move,” as the upper and lower banks of the GTI VERA Bands Indicator have been narrowing.
Travis Kling, the founder of crypto hedge fund Ikigai, told the publication:
It’s unlikely that the bottom is in for Bitcoin. I am certainly willing to change my mind, but the preponderance of evidence leads us to believe that we’ll see more lows before we head higher.
The flagship cryptocurrency’s drop has seen the rest of the market tumble as well. The MVIS CryptoCompare Digital Assets 100 Index, a market cap-weighted index that tracks the performance of the top 100 cryptocurrencies, is down about 5.51% in the last 24-hour period.
CryptoCompare data shows Ether has dropped 11.2% to $135.9, while Litecoin – which surged earlier this week after hitting 100 Lightning Network nodes – is down 10.6%. Bitcoin Cash has slid 11.5% to $142, while NEO dropped 13.1% to $8.4.
Binance’s BNB token, which last year was bucking the bearish trend, has also dropped over 10%. Notably TRON’s TRX has kept on rising. It’s at press time up 7.9% as it’s trading at $0.03.