Bitcoin „whales“ tend to throw large amounts of BTC into the market when the exchanges are quiet to draw attention to themselves.
That was the conclusion of Ki Young Ju, CEO of cryptanalysis company CryptoQuant, who observed the latest trend in Bitcoin prices this June 16.
Bitcoin whale population nears September 2017 levels
Cash flow shows a clear pattern in Bitcoin prices
According to Ki, a long-term correlation between the use of Bitcoin exchanges and price performance says a lot about the behavior of the „whales.
The cash flow metric shows how much of the BTC reaches the exchanges.
This flow means that the more exchanges that use the Bitcoin blockchain, the higher the price.
Correlation with the S&P 500 shows that Bitcoin should be worth $18,000, according to the Stock-to-Flow theory
Ki highlighted the activity in March, when BTC/USD dropped rapidly to $3,600, as a fact that corroborates his theory.
„On March 13, the use of the network for deposits and withdrawals in all exchanges dropped to 24% and continued to decline,“ he said.
Using CryptoQuant data, we see that on March 13 it showed a BTC/USD price of $5,611 and a cash flow of 0.24. Since then, the price has increased, while the flow has decreased.
Bitcoin exchange fund flow ratio
The whales are drawing attention
What this also means is that „whales“ tend to accumulate in secret when prices are low and then start selling in a conspicuous way. Ki added:
„In my opinion, whales seem to sell #BTC when exchanges are „calm“ and they want to attract the attention of other investors by dropping prices.“
As Cointelegraph reported, in the last two weeks, concerns have been heightened by a wave of selling pressure building up on the exchanges.
Bitcoin price drops to $8,900 caused by whales selling on major exchanges
That pressure caused an $800 drop in a matter of hours, while in addition to Bitcoin, similar concerns remain about a massive short-term stock sale.
Despite the „decoupling“ of macro market movements, Bitcoin remains sensitive to big changes, as demonstrated by a brief drop below $9,000 in line with stock market futures on Monday, June 15.