3 Reasons Bitcoin (BTC) Plunged For $4,000 Daily But The Worst Could Happen

It was somewhat inevitable that bitcoin would end up rallying after it shot up more than $25,000 in about a week to hit a new all-time high of $93,800 on Wednesday.

These are some of the potential reasons why the asset fell from $92,000 on Thursday to less than $87,000 on Friday morning.

Bitcoin/Price/Chart 15.11.2024. Source: TradingView Miners, Whales Selling

The first most likely reason is actually two-fold and is related to sales of some of the biggest pieces of the BTC puzzle. Lookonchain data shows that whales have deposited large amounts of bitcoins into centralized exchanges in recent days, likely taking some profits after the mind-blowing rally fueled by Donald Trump’s 24th US presidential election win.

A whale deposited 1,920 $BTC($169 million) a #Binance 1 hour ago

The whale has deposited a total of 4,060 $BTC($361 million) a #Binance in the last 3 days.https://t.co/8D2y9MbfFn pic.twitter.com/6NlWDPKoVx

— Lookonchain (@lookonchain) November 15, 2024

The second part of the sales reasoning comes from the miners. CryptoPotato reported earlier this week that some miners had started to dispose of their BTC, but at the time it wasn’t that concerning. However, more recent data from CryptoQuant indicated that they have continued to do so.

In fact, even a Satoshi-era miner started moving mined bitcoins almost 15 years ago, with some of them sent to exchanges for possibly the same reason as the previous whale.

Miners keep selling.
This time, a Satoshi-era miner moved 2K Bitcoin.

The coins were mined in 2010 and had never been moved.
Some of these Bitcoin ended up on exchanges. pic.twitter.com/I1Tlnq4FoY

— Julio Moreno (@jjcmoreno) November 15, 2024

ETF exits

After it became known that Trump will be the next president of the United States, investors started pouring substantial amounts into local Bitcoin ETFs. Nearly $5 billion flowed into the funds in just six trading days. However, the high volumes suggested that the price of BTC may have reached its local high, at least based on historical performances.

The trend reversed yesterday. Farside’s database shows that just over $400 million was withdrawn from U.S.-based ETFs, which is actually the third-biggest day of net outflows since the funds were created in January.

The first place in this adverse statistic belongs to May 1, with 563.7 million dollars withdrawn. Second place is the day before the election, November 4, with $541.1 million. Interestingly, these two dates turned out to be the lowest local prices for BTC, as the asset soared in the following weeks.

This concludes the second (complete) reason. The third is a combination of several factors, which indicated that BTC was overbought, including RSI, MVRV and rising levels of FOMO.

Despite being up 17% on the week yet, BTC remains far from its $100,000 target and the community is hoping that things will be different this time, compared to the laser eye movement of 2021.

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