Since May 10, up to 236,237 Bitcoins (worth $ 5.452 billion) have been sold by “large institutions” – mostly as a result of forced selling.
A Twitter thread from Arcane Research Analyst Vetle Lunde details how and when many Bitcoin -owned institutions began selling their stacks. Lunde says that “it all starts with Do Kwon.”
Luna Foundation Guard (LFG), which controls funds for the Terra project, spent 80,081 BTC in a failed attempt to protect the original Terra USD (UST) stablecoin in May.
The collapse of Terra appears to have made some Bitcoin (BTC) miners face selling pressure. Lunde estimates that miners sold 19,056 coins between May and June. In some cases, miners were selling more than a month production, the possibility of drawing from reserves.
Luna Foundation Guard (LFG), which controls funds for the Terra project, spent 80,081 BTC in a failed attempt to protect the original Terra USD (UST) stablecoin in May.
The collapse of Terra appears to have forced some Bitcoin miners to sell. Lunde estimates that miners sold 19,056 coins between May and June. In some cases, miners were selling more than a month production, the possibility of drawing from reserves.
Lunde noted that while miner sales went up, Tesla Elon Musk did as well press the red button and sold 29,060 BTC at the end of Q2. At the same time, crypto Three Arrows Capital (3AC). investment companies are over-leveraged and owes 18,193 BTC and the equivalent of 22,054 BTC.
Lunde also added that a massive 24,510 nebus BTC took place on the Canadian Purpose Bitcoin exchange-traded fund (ETF) in late June, “creating fire sale pressure further in the market.” The redemption accounts for 51% of the ETF’s ownership.
BTC market growth
Although the crypto market has seen tremendous selling pressure from institutions in the past few months, the Bitcoin market remains resilient.
Trading volume also remained higher during the 2022 market downturn compared to the 2017 bull market peak. On December 17, 2017, Bitcoin’s daily trading volume reached a cyclical peak of $ 12 billion, while its daily volume in July 2022 exceeded $ 20 billion. according to to CoinGecko.
CEO of Singapore market maker Presto Labs Yongjin Kim agreed with Lunde that the liquidation of 3AC and others caused a significant price drop in June, but believes the BTC price will return to $ 30,000 over the next few months.
He told Cointelegraph on July 21 that “the liquidation pushes the price of Bitcoin below the underlying equilibrium price,” leading him to believe that the price will return “to $ 30,000 in the next few months.”
related: BTC price war 200-week moving average after $ 930M Tesla Bitcoin sale
Kim added that it will take time for retail investors to gain confidence in crypto after what they have done over the past few months and institutional investment will rise again.
“I feel that retail sentiment has deteriorated, so it will take some time before we can restore confidence in the market. But there will be some reversal by the end of this year to fight liquidation.
Lunde concluded the thread by stating:
“I tend to choose forced selling and the uncertainty associated with contagion now. We’re likely to collapse, pump, and throw in an unstable situation in the future.
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