BTC Tanks Under $47K Despite Bitcoin Exchange Supply At 31-month Low, Big Hands Buying?
A brutal sell-off strikes once again in the crypto market with the Bitcoin price crashing under $47,000 on Monday, December 13. As of press time, Bitcoin seems to have recovered from the Monday lows and is currently trading at $47,198 with a market cap of $890 billion.
Interestingly, despite the Bitcoin price constantly staying under pressure, the BTC supply at the exchanges has been reducing simultaneously reaching a 31-month low. As on-chain data provider Santiment reported:
Bitcoin’s supply on exchanges hasn’t been this low in 31 months, according to @santimentfeed data. Prices have been volatile as of late, but the lack of $BTC moving to exchanges right now is a positive sign that major selloff risk should be limited.
While many have been comparing the recent market sell-off to that in May 2021 as the Bitcoin (BTC) price has already corrected nearly 40% from its all-time high of $69,000. Crypto market analyst Will Clementele says that there’s one key difference though between May’s correction and that in the current one.
During the May period, there was a major sell-off by strong hands. However, strong hands are buying this time, he says.
From an on-chain perspective, here’s the key difference between now and May:
In May: Previously strong hands became weak hands
Now: Strong hands buying from weak hands pic.twitter.com/kMe75YN732
— Will Clemente (@WClementeIII) December 14, 2021
Willy Woo: No signs of Further Sell-off Cascade
Major long positions for Bitcoin futures have been liquidated in the recent price correction suggesting a kind of reset. Besides, based on the buy/sell heatmap, crypto analyst Willy Woo says that buying the dip has been clearly visualized. He adds:
Buying the dip visualised (spot volumes seen on-chain). It has been happening, it’s moderate, but most importantly, as yet there’s no signs of a further sell-off cascade. Also worth keeping in mind longs have already been flushed.
While the retail investors continue to face a test of patience and anxiety, the on-chain data has been hinting at strength. Will this translate into a good pullback or not remains to be seen.