BTC’s price hit the lowest point since December 2020.
Bitcoin dominance has risen slightly over the last two days.
Bitcoin whales, however, seemed to be abandoning the ship, which could have long-term bearish effects.
Some of the top players in the crypto market are of the opinion that this bear market is here to stay, at least for the short term. However, nothing is constant in the crypto market, and the aforementioned statement, too, is merely a speculation and opinion.
After hitting its lowest point since December 2020, bitcoin’s price sat at $29,213 at press time, down by almost 20.85% over the week.
Bitcoin losing dominance
Bitcoin’s price is dropping like a stone as the crypto market mania continues to drive investors away. While this isn’t one of the worst falls BTC has seen, it is one of the most notable.
On the daily chart, BTC’s price bled terribly; however, on the weekly chart bitcoin price wasn’t printing its worst performance yet. Nonetheless, with the sell-side pressure rising, the correction could accelerate capital outflows as riskier assets.
In the last 24-hours, BTC’s price has fallen to as low as $26,000; however, it made some minor price recovery maintaining around the $29,000 mark at the time of writing.
Indeed the top crypto asset has lost more than 50% of its value over the last six months amid a sector-wide decline wiping off more than $1.5 trillion from the global cryptocurrency market cap since then.
That said, over the last two days, Bitcoin dominance has risen while ether’s price has broken lower against BTC.
Crypto analyst Rekt Capital shared on Twitter that BTC Dominance was at the red (lower). Historically, every time BTC dominance tested that lower red level it broke above. Thus, there’s a strong possibility that BTC dominance can continue to the top of the black wedging structure over time.
Whales Abandoning the Ship?
Analyst Ali Martinex pointed out that Bitcoin whales continued to exit the network. Notably, The number of addresses with a balance greater than 1,000 $BTC dropped to a three-month low of 2,237 addresses on May 12.
#Bitcoin whales continue to exit the network!
— Ali Martinez (@ali_charts) May 12, 2022
Generally, a fall in the number of BTC whales indicates a lack of confidence in the network. Nonetheless, some analysts believed that we might be heading towards a final capitulation phase.
Crypto Quant data presented that short-term HODLers were selling in a panic since they usually have weak hands. The same could be said by looking at the realized price, which showed that they sold at loss. UTXO Realized Price Age Distribution is a set of realized prices along with age bands.
Additionally, Spent Output Age Bands is a set of all spent outputs created within a specified age band that flowed into exchange wallets. Looking at the Spent Output Age Bands, long-term HODLers (LTH) holding BTC from 3month -18month are selling under the realized price, so they are selling at a loss.
Only LTH, which HODL bitcoin for over 18 months, were in profit until the price is under $13,000, which will act as a strong resistance.
That said, data from Glassnode highlighted that BTC Relative Unrealized Profit (7d MA) reached an 18-month low of 0.448. This signified that the network’s unrealized profits were at a low of 18-months.
— glassnode alerts (@glassnodealerts) May 12, 2022
Crypto assets and most traditional investment vehicles have been swept up in a sell-off across higher-risk asset classes. Data highlights that with the US inflation running hot, the same could be deepening investor fears about the economic impact of aggressive central bank tightening.
This article was originally posted on FX Empire