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Before Bitcoin’s dramatic price increase earlier today, an unknown buyer bought $1.6B worth of cryptocurrency in five minutes. That’s more than Elon Musk– one of the world’s richest men– spent on Bitcoin in February.
Whales Pumping Bitcoin’s Price
CryptoQuant CEO Kim Young Ju revealed the massive purchase earlier today, using his company’s on-chain data. According to a chart comparing price and buy volume on all exchanges, buy volume massively spiked early on October 6th. This was naturally coupled by an 8% price leap to above 55K USD.
Ju compares the buy-volume chart to another chart measuring short liquidations around the same time. He attributes the cause of the price increase to the former rather than the latter.
Someone(s) bought up $1.6B worth $BTC via market orders in just 5 minutes. Short liquidations seem relatively smaller like $17M at that time. This is more like whale buying, not cascade liquidations.
According to Ju’s charts, we can observe a similar phenomenon having played out on October 1st. Buy volume surges, followed by a dramatic price pump from 45K USD to about 48K USD.
The last time the Bitcoin market witnessed a large purchase was in February when Elon Musk bought 1.5 million dollars in Bitcoin. Though the latest Bitcoin purchase represents a more excellent dollar value, it’s only about 32 000 BTC after today’s price. Comparatively, Musk’s purchase was about 43 000 BTC at the time.
The purchase helped the price break past the $52 800 mark– a point of psychological resistance in September.
What Else is Driving Up The Bitcoin Price?
As expected of an October bull-cycle, Bitcoin’s price has been steadily climbing since the start of the month. Besides the time of year, several situational factors could be contributing to the pump as well.
One could be the relieving regulatory news that came from the US this week. Federal Reserve Chairman Jerome Powell established that he has no intention to ban cryptocurrencies. Days later, SEC chair Gary Gensler confirmed that he has neither the authority nor sense to do so.
Another driver could be the growing number of people HODLing Bitcoin. More on-chain analysis shows that over 85% of Bitcoin’s circulating supply hasn’t moved wallets within three months. Major Bitcoin holders, including Michael Saylor and Elon Musk, have also indicated that they have no intention to sell their Bitcoin anytime soon.