RE: Mt. Gox is a big reason for the Bitcoin price crash from all time high
I seriously doubt that these sell orders are the reason for BTC's pullback over the last couple months. If you look at the first sell date, 12/18/17, the 24 hour volume on that date was something like $13 billion. The 2000 BTC sold would account for only about $38 million of that, putting it at about 0.3% of the volume for that day. That's nothing to sneeze at for a single seller, and it would probably put downward pressure for the instant it was happening, but it's hardly the market-moving behemoth that it seems when you hear those big numbers in the millions as compared to the billions in volume. Also if you look at the price action, it had peaked on the day before and was already on the decline when they pulled the trigger.
Even the biggest sell on 1/17/18 of 8000 BTC would only amount to $69 million, accounting for only 0.4% of the $19 billion volume for that date. With this one the sell order happened near a bottom and the market continued to climb out of that bottom as it happened. It didn't pull the market down at all in that instance. Let's just face it, it was a bubble, it burst because the noobs who drove it up panic sold, and now recently crypto price action has resumed a more sane pace for a change. Don't worry though, we'll probably see some insanity in the near future.
I agree for the most part, but I am not so sure that it was the noobs who panic sold that drove the market down. The small guys are playing with 100s of thousands of dollars at most, most of them much smaller amounts, as you stated there was billions of dollars of volume every day.
I think Chinese NY, FUD around regulations, Scams like Bitconnect, FUD around futures and the Issues with Tether all culminated at a point where BTC was at an ATH and an attractive sell point for many early hodlers and whales. Once it started it snowballed as FUD after FUD in the news kept coming out and spooking the market lower and lower. Smart money drove the market lower and I feel many a noob got burned on the way down.
Good point, but thinking on it a little more, does big money necessarily mean seasoned veteran in crypto? Just because investment bankers started to play doesn't mean they're professionals in this investment category. I mean, I've been trading stocks for over ten years, but I've only been here for a couple. Then again I didn't spook, so maybe you're right after all.
Haha, that is also a good point, one idea I have tried to express to people for a long time since pondering trends and why things happen at all, in any sector, in anything at all is; there are always unfathomable amounts of ideas, outcomes, reasons, for anything to happen at all.
In regards to trading, I have found many people get caught in the trap of thinking a market moves in any direction as a type of hive mind almost instantaneously. Traders, Investors, Speculators and everyone in between buy and sell for all sorts of different reasons and they buy and sell at different price points. The markets are a living, breathing beast.
I think you are right, a whale might play with a few million dollars but he might not care if he loses some because it's only 2% of his wealth. People who buy at different prices will have different levels at which they are spooked, some easily, some not so. some people are willing to sell at a loss, others will never sell unless their portfolio meets their requirements for retirement, FOMOers are perhaps happy to get out at break even. The variables are incalculable. To me at least.
Very good stats, thanks.
We think it was a coordinated gov't + big bank attack, which began with listing of the futures (the anticipation of which helped prices in the Fall 2017 going into the "sell the news" moment of the futures listing). Large govts have too much vested interest in money printing to let crypto achieve trillion dollar asset values, at a trillion (even before a trillion) crypto is a REAL problem.
You got that right. Martin Armstrong has even been talking about this and he's been very dismissive of crypto up to this point. We'll see if he's right that they'll succeed in shutting it down. I don't think they can. It would be too expensive at this point.
Think they can, and Napster/Kazaa shutdowns (PirateBay) are the blueprint. You TECHNICALLY can't shut crypto down, but you can make it illegal activity like the US outlawed gold ownership from 1933-1972. This puts 95-99% of people "in line".
The rest are (dark side of the force) outlaws, and run the risk of jailtime. So yes, a dark crypto will eventually become the backbone of black markets, but how many people can afford to run the imprisonment risk?
We agree, you can't shut crypto down, but you can deter the masses from using it rather easily, and they already are starting (with the SEC crackdown on "semi-legal" exchanges). But they certainly clever in how the subterfuge it, ey?
It'd only take 8k btc on Bitmex to immediately drop the market by 10%...that's 6k Gox Trustee and only 2k panic sellers.
IMHO, I don't see large buyers at current prices knowing there's a Gox fire sale in the near future.
https://data.bitcoinity.org/markets/books/USD
Right, but that's not going to last an entire 24 hours, and total market volume was about double that of present at the peak sale of 2000 BTC, and almost triple the volume for the 8000 BTC sale. That increased volume accounts for a reduced effect. As we saw during the 8000 BTC sale, the price actually went up simultaneously. This is not to mention the fact that arbitrage will quickly absorb the differences between exchanges. Even today, you'd need 20K BTC to move the entire market that same 10%. Given the fact that we saw a drop of almost 70%, the effect of that 40k BTC on higher volumes would have been relatively small. It would move the market only 20% even at today's prices and volumes, only momentarily, and only if it was dumped all at once.