Two wallets inactive since 2017 moved 8,000 BTC, with on-chain data pointing to Coinbase Prime infrastructure as the likely current custodian.
Coinbase acquired Xapo’s institutional custody in 2019, leading to the transfer of over 514,000 BTC from institutional clients to Coinbase Custody.
Transfer patterns indicate a strategic OTC transaction, likely to meet corporate demand or liquidity needs, with no signs of retail or ETF activity.
Two wallets that had remained inactive for over six years have moved 8,000 BTC, each transferring 4,000 BTC. The movement occurred within the past hour, raising interest across the crypto sector due to its scale and origin.
https://twitter.com/cryptoquant_com/status/1942892349811568690
Movement Tied to Coinbase Prime Custody
According to on-chain analyst Mignolet via CryptoQuant, the wallets were initially associated with Xapo Bank. However, current data points toward Coinbase Prime as the likely custodian of these funds. In August 2019, Coinbase acquired Xapo’s institutional custody business for $55 million. This acquisition led to over 514,000 BTC being migrated from Xapo to Coinbase Custody.
Right before the current 8,000 BTC transaction, there was observable internal activity within Coinbase Prime Custody wallets. This timing strongly suggests the transaction was handled under Coinbase Prime's infrastructure rather than being a standard user withdrawal or exchange deposit.
Transaction Suggests OTC Activity, Not Retail Movement
The structure and execution of the transfer point away from retail behavior. Instead, this transaction aligns with institutional-level fund management. CryptoQuant emphasizes that the movement appears designed to support OTC (Over-the-Counter) operations, possibly in response to declining liquidity in OTC markets.
The funds may have been shifted to replenish OTC reserves or to fulfill a direct acquisition request. This interpretation is supported by the transaction pattern, which deviates from ETF-related flows, such as those tied to BlackRock. While both utilize Coinbase Prime, this activity lacks the traits typically observed in ETF inflows.
Dormant Wallet Activation Signals Institutional Reallocation
The activation of long-dormant wallets often garners attention, especially when linked to large BTC volumes. In this case, it reflects a strategic reallocation rather than panic-driven movement. Given Coinbase Prime’s prior custody over Xapo’s institutional clients, these coins were likely already under professional management.
With no indicators of exchange deposits or retail sales, the action suggests a purposeful transfer to facilitate high-value OTC settlement. The size and method of the transfer support this view, confirming institutional engagement in ongoing Bitcoin market dynamics.
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