Crypto Rollercoaster: The Week in Review

What a wild week for the crypto king, Bitcoin! Just when you thought it was cruising toward the moon, it hit a speed bump. On Wednesday, Bitcoin was just chilling above $90,000 while Ethereum was doing its thing around $3,041. But after a rough few days, those numbers didn’t exactly boost morale.

What’s the Damage?

Over the past week, Bitcoin decided to take a little tumble, dropping more than 12% like it was auditioning for a dramatic sports movie. And let’s not forget Ethereum, which fell about 11%. So, what’s going on? Analysts say that the crazy ups and downs reflect some serious on-chain activity mixed with the frantic vibes from the broader financial world.

Old Whales and New Fish

Enter CryptoQuant’s CEO, Ki Young Ju, who claims that much of the price chaos is just old whale holders swapping coins like they’re trading Pokémon cards. Apparently, these veteran Bitcoin fans have been selling their treasures to some fresh buyers from the traditional finance scene, including those fancy spot ETFs and corporate treasuries looking to hang onto the good stuff for a while.

The Great Sell-off

This isn’t the first rodeo for Ju; he had flagged the heavy selling by OG whales when prices peaked earlier this year. But now, there’s a whole new wave of institutional money flowing in, changing how the market absorbs supply. It’s like a game of musical chairs, just with a lot more cash—and way more anxiety.

Is It Over Yet?

On-chain metrics hint that we might not be witnessing the end of the world, but rather just a mid-cycle correction. Short-term holders are panicking and selling faster than a kid at a candy store, while long-term holders are simply cashing in on profits like it’s their birthday!

Newbies vs. Old Heads

Despite the drama, some fresh buyers seem to be adding to their stash even during this crazy ride. However, their enthusiasm didn’t quite match the wave of selling from jittery short-term traders. Bitcoin’s nosedive from just about $126K has all the makings of a classic market rebalance story.

Big Picture: A Trillion-Dollar Oops!

Reports indicate that a whopping $1 trillion was wiped from the broader crypto market in just a few weeks, pushing the total market cap down by a quarter since that high-flying October. According to CoinGecko, tracking more than 18,500 coins, Bitcoin alone dropped around 25%, momentarily hitting a low around $91,200. Talk about a crypto rollercoaster!

Who’s Still Buying?

JAN3 CEO, Samson Mow, indicated that there are still some buyers who couldn’t care less about the dips. He calls them price-insensitive buyers who see these moments as golden opportunities to bag more Bitcoin. He includes the likes of companies with hefty treasury budgets and stablecoin issuers who aren’t sweating the short-term slides.

A Discount that’s Hard to Ignore

If Bitcoin hovers around $95K, Mow argues that it looks like a near 20% discount for those savvy buyers willing to jump in and add to their collections while supply remains tight. Sounds intriguing, right?

Bitcoin: The Macroeconomic Star?

On a broader scale, analysts from Nansen are saying that Bitcoin is starting to act more like a macro asset. It’s moving in sync with liquidity, the dollar, and the whims of global policies. Traders are also feeling the heat from forced selling and tightened risk appetite after some major global events rocked the markets earlier this October.

Political Influences

Let’s not forget that early this year, Bitcoin had a boost from political backing under US President Trump and a wave of Wall Street love via those sweet spot ETFs. But alas, even that support couldn’t save Bitcoin from this recent slump.

So, buckle up, because the crypto ride isn’t over yet!