Key Takeaways
What’s behind the latest $1B transfers?
A small chunk was sold off, but it is not clear whether the $953 million BTC would also be dumped.
Is a recovery possible before year-end?
Yes, according to Citi’s Head of Macro Research and Arthur Hayes, citing a likely improvement in the liquidity environment.
The bankrupt Mt. Gox exchange estate has spooked the market after moving about $1 billion worth of Bitcoin [BTC].
At the time of writing, on-chain data showed that the estate moved 10.6k BTC (Worth $953 million) from a cold wallet (1DcoA) to a new wallet (1ANkD). That’s not all though as another 185.5 BTC, worth $16.8 million, was sold via Kraken exchange.
Source: X
Is another selling pressure incoming?
The latest transfer between wallets occurred after an 8-month period of dormancy, further raising concerns about the motive. In most cases, such movements, especially between cold wallets and finally into hot wallets, always precede offloading. However, it could also be just a transfer to a safer wallet.
The Mt. Gox estate extended its final repayment to 31 October 2026, due to unresolved creditor issues. It began compensation in July 2024 and had 142k BTC at that time.
It has since liquidated most of the stash and now holds 34.6k BTC, worth $3.14 billion as per current market prices.
That being said, any confirmed sell-off from the estate could further drag the already distressed markets.
Since October, BTC has dropped by 29%, slipping from $126k to $89.2k. This marks the third time it has dropped by 30% this cycle and falls within the normal pullbacks during bull runs.
Source: BTC/USD, TradingView
Although it has broken below key bull market support levels like the 365-Daily Moving Average, analysts believe it’s a temporary liquidity squeeze.
According to Dirk Willer, Head of Macro Strategy at Citibank, the liquidity conditions could soon reset and boost BTC.
“Going forward, the liquidity squeeze for Bitcoin should improve between now and year-end.”
This is a macro outlook similar to the one shared by BitMEX founder Arthur Hayes. However, Hayes expects BTC to plunge to $80k-$85k, before a potential reversal to $200k as liquidity improves.
Amid the uncertainty, however, whales with over 1000 BTC have increased positions during the correction period. The bids spiked when BTC dropped below $110k and more aggressive accumulation followed after dipping below $100k.
Source: Glassnode
In other words, some players saw the pullback and panic selling as an opportunity to grab discounted BTC.