Did $1.6 Billion in USDC Withdrawals Cause Bitcoin’s Rise?

Shortly after bitcoin (BTC) seemed to drop again for a while the market suddenly found itself in a huge short squeeze. Traders were forced to buy back their tokens, causing the price to explode. This is often not a good basis for a long-term uptrend, but there are now indications that the market is gearing up for further increases.

Are institutions playing with the bitcoin price?

Lookonchain writes on Twitter that it several major merchants herself nearly $1.6 billion USD Coin (USDC) have made their own. It appears that these traders had stored the tokens in accounts with USDC issuer Circle. At the same time, other similar funds were responsible for deposits of only 200 million USDC. So the ratio is quite skewed.

Still, the withdrawals and deposits were almost equal in total. In total, recording parties had a head start of just $41 million. So the big difference is caused by these mysterious funds whose names we don’t know – in any case, they are very large amounts. Only exchanges took even larger amounts.

It turns out that a few of these funds have deposited large amounts with crypto exchanges. One of these funds turns out in December to have done the same and now deposited $397 million. A second fund shows similar patterns and raised $953 million.

It is possible that these sharp increases of the past few weeks have something to do with this. The explosive price movements seemed to have been caused by a short squeeze. This could mean that these institutions are on the brink of a brand new long-term uptrend, or that they have knowingly or unknowingly triggered a bear market rally.

Bitcoin bottom or not?

At the beginning of last month, analysts concluded from on-chain data that bitcoin investors at least continued to buy. At the end of last year it still seemed that the bottom was in sight. After this, the price started to rise, which seems to be correct for now. Still, many whales seem to be unconvinced.

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