Analysis: Multi-Billion Dollar Bitcoin (BTC) and Crypto Surge Triggered by ‘Single Actor’

By April 23, 2019Bitcoin Business
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Analysis: Multi-Billion Dollar Bitcoin (BTC) and Crypto Surge Triggered by ‘Single Actor’

New analysis from crypto market and network data analysis firm CoinMetrics finds that a single Bitcoin trader appears to have triggered Bitcoin’s sudden surge above $5,000 on April 2nd.

CoinMetrics says the move likely started on HitBTC’s Bitcoin-Tether market, with a matched trade of about 500,000 Tether for 122 Bitcoin.

That trade was immediately followed by two more big buys on Coinbase and Bitfinex, which triggered a domino effect that dramatically raised the price of BTC from $4,200 to more than $5,000 in the span of about an hour, boosting BTC’s market cap by more than $12 billion.

Source: CoinMetrics

CoinMetrics says the timing of the trades indicates they were designed to have maximum impact during a period of relatively low liquidity, forcing stop losses and a short squeeze through liquidations of margin positions and short futures positions.

“Our theory is that a single committed actor went long and traded in a manner that maximized price impact. The movement in price started at 04:30 UTC time, the point in the day where global liquidity is at a minimum.”

Here’s a closer look at the big trades on HitBTC, Coinbase and Bitfinex.

Source: CoinMetrics

A number of theories on what caused the Bitcoin pump have circulated since the rally.

One largely dismissed theory is that crypto trading bots began buying BTC after tracking a fake April Fools’ Day article pretending a Bitcoin ETF had been approved by the US Securities and Exchange Commission.

Crypto market maker Cumberland reported a surge of 13 Bitcoin bids on BitMEX worth more than $4.9 million each, all traded in less than an hour, starting after midnight on April 2nd.

Desk Update: The post-trade analysis of Monday evening’s price action revealed a series of large bids (>1,000 BTC per order) within a 1 hour span, which appear to be actual buyers vs. forced liquidations.

— Cumberland (@CumberlandSays) April 4, 2019

The CEO of cryptocurrency firm BCB Group, Oliver von Landsberg-Sadie, says he also believes the pump was initiated by a single Bitcoin whale, in a coordinated effort to buy nearly $100 million worth of BTC on three crypto exchanges.

Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

CoinMetrics […]

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