Bitcoin speculators move 55K BTC to exchanges amid $1.1B liquidations

Data from CoinGlass put total crypto liquidations at $1.09 billion for the 24 hours to 10 am UTC on Friday.

This was the largest daily tally since Aug. 21, when $BTC/USD rose from $73,000 to $79,500, setting two-month highs and triggering $1.3 billion in crypto short liquidations. Conversely, long positions accounted for $1.05 billion of Thursday’s total.

$BTC/USD vs. crypto liquidations. Source: CoinGlass

The sell-off followed reports of the US government moving more than 12,000 $BTC that it had previously confiscated. Such transfers can fuel potential sales.

$BTC/USD dropped to $80,350 on Bitstamp, its lowest level since Sept. 18, before recovering to around $82,500 on Friday. That level remained key during Bitcoin’s broader uptrend since early July, and the breakout point for an inverse head-and-shoulders pattern. Bitcoin would need to hold it as support to confirm the bullish reversal.

Trader and analyst Rekt Capital, who has tracked the reversal pattern and its similarities to Bitcoin’s 2023 recovery, now sees the upcoming weekly candle close as key.

“Bitcoin is currently failing its retest of ~$82500. Weekly Close below $82500 and turn it into resistance however and Bitcoin will be back in its Macro Accumulation Range,” he said Thursday on X.

$BTC/USD one-week chart. Source: Rekt Capital on X.com

Short-term holders send 55,600 $BTC to exchanges at a loss

Onchain data also showed stress among newer Bitcoin investors as the market fell.

Analytics platform CryptoQuant contributor Amr Taha reported that short-term holders — entities holding Bitcoin for up to six months without selling — sent 55,600 $BTC to exchanges at a loss on Thursday.

Transactions at a loss refer to coins being sent to exchanges at a lower price than during their previous transaction. They often reflect investors’ impulsive urge to exit their positions at a loss, fearing further downside if they delay their sales.

CryptoQuant notes that Thursday’s loss tally was more than on June 26, when Bitcoin fell below $60,000 for the second consecutive day.

“Notably, Bitcoin was trading above $81,000, compared with $59,300 in June — a price difference exceeding 36%,” the contributor wrote, adding that exchange users may not have opted to sell the entirety of their positions, even after moving them to their accounts.

Bitcoin STH transactions in profit and loss to exchanges. Source: CryptoQuant

“Historically, aggressive loss-driven selling by short-term participants can coincide with short-term capitulation, potentially exhausting weaker holders and creating conditions for a subsequent price recovery,” the report said.