Bitcoin Faces 30% Monthly Loss Amid Whale Transactions
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The price of Bitcoin (BTC) continues to slide, experiencing a recent drop of 1.39% in the past day, which has contributed to a staggering monthly decline exceeding 30%.
Market dynamics are predominantly influenced by a bear trend, yet recent blockchain data suggests that significant activity from large holders, known as whales, may be exacerbating the situation for BTC.
According to blockchain analytics firm Lookonchain, a particular whale identified by the wallet address 3NVeXm has been making substantial deposits to Binance coinciding with Bitcoin’s price fluctuations. Initially, this whale deposited relatively small amounts over the last three weeks, but the pace of transactions increased dramatically this week.
The situation escalated on February 11, when the whale transferred 5,000 BTC, followed by an additional 2,800 BTC transferred just today. These movements have drawn attention, as Lookonchain pointed out that BTC typically declines following such deposits.
Reportedly, there were indications that each deposit by this whale has led to a drop in BTC prices, with one instance leading to a more than 3% decrease shortly after the deposit was made.
Currently, this wallet retains 166.5 BTC, which is valued at over $11 million. Large inflows into exchanges are often seen as a signal that holders may be preparing to sell, as they typically transfer assets to these platforms for liquidation or hedging purposes.
While it’s important to note that correlation does not equal causation, the scale and timing of these whale activities likely intensified selling pressure in an already vulnerable market. Traders often react to these on-chain signals, which can amplify downward trends.
Parallel to these events, the Bitcoin market is experiencing considerable stress, with realized losses reportedly reaching $2.3 billion. Analysts highlighted that this marks one of the highest levels of capitulation in Bitcoin’s history, with few instances of such significant losses occurring previously.
Notably, it appears that short-term investors—those who have held BTC for under 155 days—are contributing heavily to the current capitulation, particularly those who bought at highs of $80,000 to $110,000 and are now facing marked losses. Conversely, long-term holders are not driving this sell-off, as they are historically inclined to hold onto their assets during downturns.
Historically, extreme loss events have often preceded recoveries. After a notable capitulation, BTC previously rebounded from $60K to $71K. However, there are concerns that this might signal the onset of a more prolonged and gradual decline.
Some analysts from Cryptowinx have signaled that Bitcoin may still be in the initial stages of a larger bearish cycle, suggesting that further declines are possible. They noted that Bitcoin’s realized price currently sits at around $55,000— a threshold typically linked with bear market bottoms.
In earlier cycles, Bitcoin has traded 24% to 30% below its realized price before finding stability. As of now, BTC remains above that boundary, yet as it nears this level, historical patterns show it often enters a phase of lateral movement prior to any recovery attempts. Some experts warn that a deeper correction below the $40,000 mark could signify a more definitive bottom.
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