BlackRock has recently transferred 100,000 BTC to hidden wallets, and this has sent shockwaves through the cryptocurrency community. Many are fearful that they might offload a whopping $1 billion worth of BTC, which could have a significant impact on the market. So, I delved into an in-depth analysis of their latest actions to decipher their true intentions. What I uncovered was truly astonishing.
When BTC whales made a large-scale asset dump in the past, the price plummeted by 30%. Just two days ago, BlackRock's transfer of 100k BTC to multiple wallets raised eyebrows. I then set out to explore all the potential outcomes. Essentially, there are only two likely scenarios: either BlackRock will sell the BTC or they are engaged in a strategy to manipulate retail investors. Each of these scenarios comes with its own set of advantages and disadvantages.
Could BlackRock be on the verge of selling? Currently, BlackRock stands to make a substantial profit from their BTC holdings. Although they don't publicly reveal their average entry price for BTC, by looking at the period when they were accumulating BTC in their wallets, it appears that the price ranged from $30,000 to $40,000 per coin.
Most of us recall the instances when Germany and MT Gox liquidated their BTC holdings. They sold a staggering $9 billion worth of BTC, which caused the price to drop from $72,000 to $54,000. However, it's important to note that the price decline wasn't solely due to their selling. Given that BTC has a daily trading volume of $20 billion, a $9 billion dump shouldn't have led to a 25% decrease. The real culprit was the panic among retail investors, which triggered a massive sell-off by them.
In the last week, a growing number of people have started to have faith in the current bull run. Even in the case of BTC, there have been a significant number of buy orders in the $100,000 range. This could potentially be an opportune moment for market players to weed out those with weak investment stances.
These recent BTC transfers by BlackRock could also be construed as an attempt to manipulate retail investors. Yesterday, they disclosed the percentage of BTC that their investors should own. This is the first time they have informed their clients about direct crypto ownership. If they were to offload BTC into their own clients' accounts, it could potentially damage their reputation.
In summary, it's not an ideal time to enter the market at present. The market is likely to maintain its bullish trend, but we can expect to see a considerable number of sell-offs. New and more favorable entry opportunities will emerge in due course. It's advisable not to rush into things and to continuously strive to enhance our market understanding.
Thank you for reading!
