After an exuberant risk-on rise in Bitcoin’s price Tuesday, a retracement since Wednesday wiped out most of the gains. Traders blame Tesla’s Q2 earnings report.
Bitcoin prices have been hovering around the $20,000 level since mid-June. Markets are watching closely to see what bitcoin whales do next. Tesla announced that it sold 75% of its bitcoins on Wednesday. As a result, markets got jittery and erased Tuesday’s gains.
Tesla Dumps BTC for Cash, Anonymous Whale Moves 242K Bitcoin
In an earnings call Wednesday, Elon Musk said:
“The reason we sold a bunch of our bitcoin holdings was that we were uncertain as to when the Covid lockdowns in China would alleviate so it was important for us to maximize our cash position. This should be not taken as some verdict on bitcoin.”
Compounding market concerns, a whale address spent the week sweeping nearly 242,000 BTC on Coinbase. That’s over $5.4 billion worth of crypto at today’s exchange prices. It was the third richest address on the blockchain. Extensive speculation that it was Michael Saylor’s MicroStrategy wallet may also have added some price resistance this week.
After Tesla recently sold off a majority of its holdings, there is some trepidation in the crypto community that MicroStrategy will soon follow suit. But blockchain researcher Jarvis Labs called the speculation about MicroStrategy “noise” in a tweet thread Thursday.
Jarvis Labs also pointed out that this wallet has been accumulating since 2019. MSTR only made its first purchase of BTC in 2020, according to regulatory financial disclosures required by the federal government.
It’s very unlikely the company has lied to the SEC and investors about its balance sheet. This sheds much doubt on the notion the wallet and 240+ thousand bitcoin are MicroStrategy’s.
Jarvis concluded:
“Wallet labels are incredibly complex and a sensitive topic. As they lack confirmations from the relevant party most of the time. So take such noise with a grain of salt. Relax, he hasn’t sold yet, even though he assumed it was Saylor’s MSTR wallet.
CryptoQuant CEO Ki Young Ju cast further doubt on the rumor Wednesday.
CryptoQuant: Whale Move Likely Internal
Ki said the transfers bear all the traces of an internal transfer, not a user transfer to an exchange. And he thinks the addresses belong to Gemini, not Microstrategy or Coinbase. The CryptoQuant CEO concluded, “This is FUD.”
Even if this was a user address moving on exchanges, this is purely speculation, the reason is to sell. Ki commented earlier this month on the heavy flows between spot exchanges like Coinbase and crypto derivatives exchanges.
He said these data reveal whales are readying their bitcoin as collateral for bitcoin futures. That could be a signal that bitcoin is oversold and the cyclic bottom is near.
If that’s not enough to quell ‘FUD’, Michael Saylor himself tweeted diamond hands Thursday amid rumours. As recently as June 29, MicroStrategy purchased an additional $10 million worth of bitcoins.
