- There were notable movements from a category of long BTC holders.
- BTC dropped below a critical support line in the last 24 hours.
It’s not been a happy week for Bitcoin, with the world’s largest cryptocurrency losing 9% of its value over the last 7 days. In fact, such was the scale of depreciation that BTC briefly dropped below $54,000 too, before recovering to trade at $55,275 at press time.
Source: BTC/USD, TradingView
In fact, over the course of its price fall, Bitcoin [BTC] breached a critical threshold on the charts too, prompting long-term investors to act cautiously. This shift might be linked to recent activity involving an exchange that collapsed more than ten years ago.
Long-term BTC holders make moves
AMBCrypto’s recent analysis of Bitcoin’s Spent Output Profit Ratio (SOPR) for long-term holders and Spent Output Age Bands has revealed notable trends. The SOPR for long-term holders exceeded 10.
This indicated that despite declining BTC prices, these holders made significant profits when moving their BTC to exchanges. The SOPR value above one, as observed in the current chart, underscored this trend.
Additionally, AMBCrypto’s look at the Spent Output Age Bands provided insights into specific groups of long-term holders actively transferring Bitcoin.
The data indicated that holders within the 5-7 year category were the most active, having moved over 10,000 BTCs on the 3rd of July. This marked the highest transaction volume in months for this group.
Source: CryptoQuant
The Mt.Gox angle
In addition to the influence of Bitcoin’s price decline, recent developments surrounding the defunct exchange Mt. Gox could also impact long-term holders’ actions.
Reports indicate that Mt. Gox has recently moved a substantial amount of Bitcoin to another wallet, including some transfers to a hot wallet.
These actions are part of the exchange’s preparations to repay its creditors more than a decade after its collapse.
This movement of BTC by Mt. Gox, which Arkham reported as involving 47,229 Bitcoins valued at approximately $2.71 billion, is significant.
With Mt. Gox set to repay around $8.5 billion worth of Bitcoin to its creditors, anticipating these transactions could prompt long-term holders to move their holdings.
The move could be due to fear of a further drop in the BTC price due to these large-scale repayments.
More shorts dominate the Bitcoin trade
At press time, Bitcoin was trading at approximately $55,300, based on its daily time frame price trend. Also, recent analysis seemed to indicate that short sellers have dominated the market over the past 48 hours.
Source: Coinglass
Read Bitcoin’s [BTC] Price Prediction 2024-25
According to the BTC Long/Short Ratio chart from Coinglass, the proportion of short positions was 52.64%, compared to 47.36% for long positions on the 4th of July.
The short ratio has slightly increased to 52.81%, while the long ratio has decreased to 47.19%.
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