After Bitcoin’s meteoric rise of nearly 2000% in 2017 — reaching a high of about $20k, the king of Cryptocurrencies entered into an extended bear market. This bear market lasted approximately 15 months until April of 2019, when a new cycle emerged. This time around, Bitcoin rose from ~$3k to ~$14k in only three months (June 2019). While many were calling for returns to all-time-high price levels, the market has proved otherwise (at least thus far). The downturn got ugly in August, when Bitcoin posted an unprecedented 14 consecutive 4H candles.
What would later be named Bitcoin’s “death streak” began at a price point of around $11400 and is what ultimately pushed the price below the important psychological number of $10k. See the chart below:
Until this chart formed, the longest 4H red streak Bitcoin had experienced was limited to 9. This price action was the first time that Bitcoin showed a decoupling from gold. To this point, Bitcoin had mimicked the price action of the precious metal, but while Bitcoin plummeted, gold remained stable.
Crypto analysts are now uncovering a massive scam that is the likely cause for Bitcoin’s woes.
In October, ErgoBTC published a Medium article detailing a massive BTC whale from Plus Token that was using a coin mixing service to anonymize their funds. Plus token was an Asia-based ponzi scheme that encouraged users to “stake” their BTC and other major cryptocurrencies. In total, they stole over 200,000 BTC, which they sent mostly to Huobi. Check out ErgoBTC’s article here.
Six members of the Plus team were arrested on June 27, but the dumping of these stolen funds has continued, with an average of 1300 BTC sold per day. This figure represents the rough equivalent of 72% of daily BTC mining rewards.
Assuming that selling continues at the current rate, it is likely to conclude by February of 2020. Until then, it is highly unlikely that BTC will experience a bullish turn. However, with the block halvening upcoming in May of 2020, these funds would be better held by strong hands.
Here’s to new highs in 2020!
*Always do your own research before investing*