Unprecedented Trading Volume Surges as Whales Dive in Whats Behind Bitcoins Price Surge

Why is the Cryptocurrency Market Rising?
This week, the cryptocurrency market experienced a sudden crash influenced by multiple factors, including selling by Jump Trading, ETF fund flows, the U.S. presidential election, and escalating tensions in the Middle East, with Bitcoin (BTC) prices even briefly falling below $50,000. Following the weekend massacre, Bitcoin prices saw a significant rebound yesterday (8th), regaining the $60,000 mark.
Bitcoin rose 6.4% in the past 24 hours, with prices landing at $61,223; Ethereum (ETH) also surpassed $2,600, rising 8.8% in the same timeframe.
Strong U.S. Labor Market Data
The rapid price recovery is closely linked to the latest U.S. labor market data. According to data released by the U.S. Department of Labor on August 5, the number of initial jobless claims decreased from 250,000 the previous week to 233,000 for the week ending August 3, falling below economists’ expectations of 240,000.
This data indicates that the U.S. labor market remains robust, alleviating concerns about an economic recession and weakening expectations of a substantial rate cut by the Federal Reserve in September.
Market Leverage Short Liquidation
Another major driver of Bitcoin’s price increase comes from the liquidation of leveraged short positions in the cryptocurrency market.
In the past 24 hours, over $114 million in short positions have been liquidated, indicating a reduction in short pressure in the market. At the same time, the number of outstanding contracts for Bitcoin futures has also increased, rising from $26.65 billion the previous day to $27.01 billion. This suggests that market risk appetite for Bitcoin is increasing, with investors beginning to re-enter the market.
Short: A trading method that involves selling first and buying later to profit from the price difference.
Outstanding Contracts: Derivative contracts that have been bought or sold but not yet settled. Outstanding volume can be seen as capital still in the market.
Bitcoin Whales Accelerate Accumulation, Exchange Balances Hit Five-Year Low
As the cryptocurrency market offered a “one-week limited-time special,” Bitcoin whales quickly entered the market to increase their holdings when prices fell below $50,000.
According to data from market analysis firm Santiment, wallet addresses holding between 10 to 1,000 Bitcoins reached their highest trading levels since early April on August 5 and 6, indicating that these large players in the crypto space seized the opportunity to accumulate more coins during the price dip.
This is a positive signal, as the continued accumulation by these crypto whales reflects a bullish sentiment towards the cryptocurrency market.
Additionally, data from CryptoQuant shows that Bitcoin balances on exchanges have reached a five-year low, with only 2.68 million Bitcoins remaining. This indicates that an increasing number of investors are transferring Bitcoins to self-custody wallets, reducing selling intentions and anticipating further price increases in the market.
References:
cointelegraph,
coindesk