Large withdrawals from exchanges are being recorded today that may offset the potential for a future sell-off.
Tracking the movement of whale wallets can often be used as an indicator for general market sentiment. As of today, there have been some large withdrawals from exchanges.
Whales Move Funds off Exchanges
According to Whale Alert (@whale_alert), two major withdrawals from exchanges were processed today—with potentially more to be expected.
Whale Alert recorded that 5,000 BTC ($36.4M) was withdrawn from Bitfinex to an external wallet
?? ?? ?? 5,000 #BTC (36,484,419 USD) transferred from #Bitfinex to unknown wallet
— Whale Alert (@whale_alert) April 9, 2020
Around the same time, the bot recorded yet another withdrawal. Some 4,000 BTC ($29M) was transferred from OKEx to an external wallet.
?? ?? 4,000 #BTC (29,109,410 USD) transferred from #OKEx to unknown wallet
— Whale Alert (@whale_alert) April 9, 2020
Although we cannot draw conclusions on these withdrawals alone, it may be an indication that whales are deciding to HODL amid this unique economic situation. This bodes well for the short-term future of the cryptocurrency market.
Uncertain Times
Analysts have been split on what we can expect as we get closer and closer to Bitcoin BUY NOW’s halving event. Scheduled for mid-May, some were speculating that miners would be eager to dump their holdings before their profits are slashed due to Bitcoin’s halving. However, sell pressure from miners has thus far been absorbed—at the time of writing, Bitcoin is trading for $7,300 and is up 0.43% on the daily.
However, the main metric traders are watching now is not the cryptocurrency market but more general macroeconomic trends. With spiking jobless claims in the United States and low consumer confidence, there are concerns that any post-coronavirus recovery will be sluggish. It’s currently unclear how this will impact cryptocurrency markets.
The Fed has been keen on propping up financial markets, but there is uncertainty over whether this strategy will be effective. As the Fed has maintained, there is “unlimited cash” readily available. However, with interest rates close to 0% already, the Fed is running out of tools to remedy any future crisis.
The jury is still out on what to expect, but the fact that whales are moving their funds off of exchanges may indicate that there is some confidence for the cryptocurrency market to weather this storm.
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