{"id":416505,"date":"2022-03-15T20:05:00","date_gmt":"2022-03-15T17:05:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/bitcoin-risks-final-bear-market-capitulation-as-rich-investors-continue-btc-selloff-analyst\/"},"modified":"2022-03-15T20:05:00","modified_gmt":"2022-03-15T17:05:00","slug":"bitcoin-risks-final-bear-market-capitulation-as-rich-investors-continue-btc-selloff-analyst","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/bitcoin-risks-final-bear-market-capitulation-as-rich-investors-continue-btc-selloff-analyst\/","title":{"rendered":"# Bitcoin risks final &#8216;bear market capitulation&#8217; as rich investors continue BTC selloff \u2014 analyst"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a27810043bc3\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a27810043bc3\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoin-risks-final-bear-market-capitulation-as-rich-investors-continue-btc-selloff-analyst\/#%E2%80%9D_Bitcoin_risks_final_%E2%80%98bear_market_capitulation_as_rich_investors_continue_BTC_selloff_%E2%80%94_analyst_%E2%80%9C\" >&#8221; Bitcoin risks final &#8216;bear market capitulation&#8217; as rich investors continue BTC selloff \u2014 analyst &#8220;<\/a><ul class='ez-toc-list-level-2' ><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoin-risks-final-bear-market-capitulation-as-rich-investors-continue-btc-selloff-analyst\/#Room_for_another_Bitcoin_drop\" >Room for another Bitcoin drop?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoin-risks-final-bear-market-capitulation-as-rich-investors-continue-btc-selloff-analyst\/#Whales_have_been_selling_their_BTC\" >Whales have been selling their BTC<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoin-risks-final-bear-market-capitulation-as-rich-investors-continue-btc-selloff-analyst\/#Bitcoin_is_%E2%80%9Cmost_deflationary%E2%80%9D_in_history\" >Bitcoin is &#8220;most deflationary&#8221; in history<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_Bitcoin_risks_final_%E2%80%98bear_market_capitulation_as_rich_investors_continue_BTC_selloff_%E2%80%94_analyst_%E2%80%9C\"><\/span>&#8221; Bitcoin risks final &#8216;bear market capitulation&#8217; as rich investors continue BTC selloff \u2014 analyst &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div class=\"post-content\" data-v-128018ef>Bitcoin (BTC) could undergo one last bear market capitulation if &#8220;whales&#8221;  \u2014 addresses that hold more than $1 million worth of Bitcoin \u2014 ramp up their selling pressure, according to on-chain analyst Willy Woo.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Room_for_another_Bitcoin_drop\"><\/span>Room for another Bitcoin drop?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Woo\u00a0<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/willywoo.substack.com\/p\/053-transitions?s=r\">assessed<\/a>\u00a0the average price at which short-term investors entered the Bitcoin market across history and charted the daily change in the value. That resulted in a cost basis, a metric that signals when &#8220;inexperienced&#8221; traders sell BTC to &#8220;experienced&#8221; traders during a BTC free fall, which typically coincides with the market bottom.<\/p>\n<p>The cost basis underwent significant dips during the previous bear markets, also before strong accumulation took place, as shown in the chart below. Interestingly, Bitcoin&#8217;s ongoing correction \u2014 from $69,000 in November 2021 to around $39,000 in March 2022 \u2014 has not resulted in a massive drop in its cost basis.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-03\/ef555dd6-4528-4abe-97a4-1e89bb9757b2.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin short-term holder cost basis change. Source: Willy Woo<\/em><\/figcaption><\/figure>\n<p>&#8220;It\u2019s inconclusive whether we have capitulated yet,&#8221; said Woo, adding that &#8220;there\u2019s room for another drop&#8221; based on the cost basis signal.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Whales_have_been_selling_their_BTC\"><\/span>Whales have been selling their BTC<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Woo&#8217;s outlook <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>eared in line with the rising speculations about Bitcoin&#8217;s next big drop. For instance, Christopher Yates, the editor at\u00a0AcheronInsights, said BTC&#8217;s price could crash to $30,000 due to the &#8220;deteriorating macro environment.&#8221;<\/p>\n<p>&#8220;What makes me increasingly wary that the low is not yet in for 2022 is the fact that we are yet to see a capitulation style spike in volume that has occurred at all the recent lows in late 2019, early 2020 and mid-2021,&#8221; Yates <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/seekingalpha.com\/article\/4495204-crypto-market-outlook-tough-times-ahead\">wrote in his latest BTC analysis<\/a>, adding: <\/p>\n<blockquote><p>&#8220;Though not a prerequisite for a market bottom, such a capitulation-like spike in volume helps to give us confidence for when such a bottom may be near.&#8221;<\/p><\/blockquote>\n<p>Data resource Ecoinometrics <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/ecoinometrics.substack.com\/p\/ecoinometrics-wiggle-room?s=r\">provided<\/a> evidence of the demand gap between small and rich Bitcoin investors in its latest weekly report. For example, it noted that addresses that hold as much as 10 BTC have been accumulating the coins in the past 30 days.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-03\/6e7a3f37-76f1-459d-ad5a-ca060bdf7557.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin on-chain accumulation and distribution. Source: Ecoinometrics<\/em><\/figcaption><\/figure>\n<p>Conversely, those that hold more than 10 BTC have been distributing them.<\/p>\n<p>Woo also noted that Bitcoin whales have been selling off their stash, thus maintaining the downward pressure on price. That means small investors have been absorbing the sell-side pressure, and so far preventing Bitcoin price from dipping below $30,000.<\/p>\n<p>Additionally, Ecoinometrics analyst Nick, noted that the ongoing accumulation trend is &#8220;as sluggish as it gets,&#8221; adding that it could grow weaker after the Federal Reserve&#8217;s expected rate hike in March to tame rising inflation. Excerpts:<\/p>\n<blockquote><p>&#8220;To summarize, the Fed is in control. If they mess up their tightening cycle, all risk assets will tank. Bitcoin currently trades like a risk asset, so it is unlikely to be an exception.&#8221;<\/p><\/blockquote>\n<p>Ecoinometrics and Willy Woo&#8217;s analysis also show that inexperienced investors have not been dumping their coins, thus becoming long-term holders (LTH) in the process.\u00a0<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Bitcoin_is_%E2%80%9Cmost_deflationary%E2%80%9D_in_history\"><\/span>Bitcoin is &#8220;most deflationary&#8221; in history<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Meanwhile, another metric dubbed &#8220;LTH Inflation\/Deflation ratio&#8221; is also corroborating the aforementioned theory, according to ARK Invest on-chain analyst David Puell.\u00a0<\/p>\n<p>In detail, Bitcoin inflation points to LTH releasing their BTC into circulation faster than the natural sell-side of miners. Conversely, deflation suggests that LTHs have absorbed a proportional amount of the miner sell-side every day alongside the outstanding total supply.<\/p>\n<p><strong><em>Related:\u00a0Crypto vs. physical: Musk-Saylor inflation debate boils down to scarcity<\/em><\/strong><\/p>\n<p>The attached chart below shows the LTH Inflation\/Deflation ratio showing the period of inflationary outcomes flashed in red and deflationary readings in green.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-03\/210dba0e-11b9-4af9-818c-cdf29156e8f7.jpeg\"><figcaption style=\"text-align: center;\"><em>Bitcoin LTH market inflation\/deflation ratio. Source: ARK, Glassnode<\/em><\/figcaption><\/figure>\n<p>&#8220;Our analysis suggests that Bitcoin, proportional to supply held by long-term holders (LTH), is at its most deflationary in history,&#8221; noted David Puell, an on-chain researcher at ARK Invest.<\/p>\n<p class=\"post-content__disclaimer\">The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.\n<\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/bitcoin-risks-final-bear-market-capitulation-as-rich-investors-continue-btc-selloff-analyst\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; Bitcoin risks final &#8216;bear market capitulation&#8217; as rich investors continue BTC selloff \u2014 analyst &#8220; Bitcoin (BTC) could undergo one last bear market capitulation if &#8220;whales&#8221; \u2014 addresses that hold more than $1 million worth of Bitcoin \u2014 ramp up their selling pressure, according to on-chain analyst Willy Woo. Room for another Bitcoin drop?&#8230;<\/p>\n","protected":false},"author":1,"featured_media":416506,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDMvMWY0MWYyYTYtYTk1YS00ZmRiLWIyNjgtNzNhZGU4ZjQxYjJmLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,81951,74937,74982,81262,74939,75679,78261,70550,70551,73785,71407],"class_list":["post-416505","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-bitcoin-analysis","tag-bitcoin-price","tag-btc-markets","tag-cryptomarket","tag-market-analysis","tag-market-capitalization","tag-tech-analysis","tag-federal-reserve","tag-inflation","tag-markets","tag-trading"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/416505","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=416505"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/416505\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/416506"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=416505"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=416505"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=416505"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}