- Sole Bitcoin miner may have caused yesterday’s Bitcoin price crash after selling thousands of BTC
- Unknown miner has history of dumping when Bitcoin gets close to $10,000
- Sells seem to be conducted on public exchanges rather than OTC
A single Bitcoin miner may have been behind Bitcoin’s startling drop yesterday, according to the CEO of a blockchain data analysis firm. Ki Young Ju, the head of CryptoQuant, posited the theory that Bitcoin’s quickfire $1,000 crash was down to a lone Bitcoin mining pool who market sold thousands of BTC following Bitcoin’s jump over $10,000, causing a negative cascade that put bulls back in their place just hours after they were celebrating the jump back into five figures.
— Ki Young Ju (@ki_young_ju) June 2, 2020
Unknown Bitcoin Miner Dumps Thousands of BTC
The Bitcoin miner in question is one of the ‘unknown’ pools that make up the total Bitcoin hashrate, and CryptoQuant’s data shows that yesterday they shipped ₿2,293 out of their wallets just six hours after Bitcoin leapt over the $10,000 barrier, followed by another ₿1,060 three hours later. They then followed this up with a final ₿295 withdrawal, complemented by other outflows of up to ₿100 scattered in between these large sells, equaling some ₿4,500 in total.
Shortly after the outflows ceased the Bitcoin price crashed $1,000 in three minutes, suggesting that, rather than going through an OTC desk like most large scale sellers would, the mining pool sold all their Bitcoin, worth some $200 million at the time, on the open market. Naturally, this mass sell ran through the orderbook like a dog’s tooth through a freshly cooked chicken, causing a ripple effect on all other exchanges.
Not This Miner’s First Rodeo
As Ju points out, the same miner has previous – they also dumped a staggering ₿5,642 on May 20 just before Bitcoin dropped from $9,700 to $8,800, suggesting that they are keen on dumping their earnings when Bitcoin gets close to $10,000.
The only way to prevent this particular Bitcoin miner from repeating the pattern over again is to move upwards quicker than they can replenish their stocks. This is something that Bitcoin can certainly do in a full on bull market, but despite being in the early stages of one we’re not quite there yet, meaning the miner is getting plenty of chances to restock their wallets before emptying them again when they see fit.