The new year has kicked off on the right foot for Bitcoin investors. The currency has continued with its rally, gaining $375 since the year turned. In the past 24 hours, the currency has gained 6.5 percent, finally hitting the $4,000 level again. The last time Bitcoin hit this level was December 25, after which it went down all the way to $3,650. The fightback is certainly noteworthy, but according to some analysts, it’s not yet time to pop the champagne.
The 6.5 percent surge happened in 30 minutes. This could indicate that it was as a result of a one-time market move, such as a whale moving their crypto holdings. It could also be as a result of reduced liquidity in the crypto markets. This is according to Mati Greenspan, the renowned crypto markets commentator who also serves as the senior market analyst at eToro. Mati’s sentiments are supported by crypto VC guru Chris Burniske who believes retail investors have forgotten about Bitcoin. According to him, the hype experienced a year ago has died down and most people are moving on to other opportunities.
The Whales Circling Around
The crypto whales have been rampant over the past two days, with Ethereum being the biggest beneficiary. As reported by whale tracking service Whale Alert, over $273 million worth of Ether was transferred over the weekend. The transactions were less than 25, ranging from $3 million to $18 million. Ten of these transactions were from Bitfinex, with the receiving addresses being unknown. ZB.com, Gemini and Kraken also took part in the transactions.
Bitcoin also saw a few huge transactions, with one worth $10 million being the largest. The effect of the whales has been felt in regards to the daily trading volume. Bitcoin’s volume has hovered around $5 billion since Thursday last week. At press time, the volume stood at $5.6 billion, the highest so far this year.
The movement by the whales could have affected the liquidity in some markets. Consequently, this could have pushed the price upwards. Whether or not this was the case will be determined by Bitcoin’s ability to sustain the rally and stay above $4,000.
Not yet Time for Champagne
It’s not yet time for champagne, Mati Greenspan has cautioned. According to Mati, the sudden spike could be the result of a micro action and could be erased soon. However, judging by Bitcoin’s resilience in the past 12 hours over $4,000, it could signal a price rally.
A surge of 6.5% in 30 minutes is not entirely uncommon for bitcoin and could very well be caused by a single large order on an exchange or even by a lack of liquidity in the market. What’s interesting about this move is that it did bring us above the $4,000 level and so far is holding onto the gains
And according to Chris Burniske, retail investors are gradually moving away from Bitcoin. Chris is a partner at crypto venture capital firm Placeholder VC and the author of ‘Crypto Assets.’ Chris took to Twitter to express his belief that despite the increased spotlight from institutions and lawmakers, the retail interest has decreased significantly.
But the mainstream? For most, #crypto is still not relevant to their life.
If they didn’t invest in 2017, they’ve forgotten. If they did, chances are they have a bad taste in their mouth and want to forget.
— Chris Burniske (@cburniske) January 5, 2019