Bitcoin price reached a historic milestone on March 5, surging to an all-time high of $69,000. However, this momentous achievement was short-lived as the price experienced a sudden crash, briefly falling below $60,000. The crash was attributed to heavy selling from long-term Bitcoin holders, as several whales and dormant accounts took the opportunity to secure profits.
Data from CryptoQuant revealed that crypto exchanges saw a three-day streak of Bitcoin inflows totaling $525 million. This suggested that traders were transferring their Bitcoin from cold storage to exchanges in order to take advantage of the anticipated all-time high and cash out.
One particular case that caught the attention of the crypto community was the awakening of a dormant whale who had been inactive for 14 years. This whale deposited 1,000 BTC (equivalent to $67.1 million) to Coinbase when the price was trading at $67,116. Remarkably, this Bitcoin was mined by the whale back in 2010 when the price was below $0.28, indicating a profit of over $60 million.
While Bitcoin holders were able to profit from the price surge, leverage traders faced a less fortunate outcome. More than $1 billion worth of leveraged positions were liquidated due to the extreme price volatility, making it the largest liquidation day since the previous market cycle’s peak.
The Bitcoin binary spending indicator also revealed that many Bitcoin holders made a profit when the price reached $69,000. This indicator tracks the movement of Bitcoin funds based on their supply timeline over the years.
Additionally, Bitcoin witnessed its highest selling volume on Coinbase in a single day since the FTX crash, indicating significant selling pressure in the market.
Despite the recent selling frenzy and flash crash, not all Bitcoin holders are eager to sell. CryptoQuant data shows that 45% of Bitcoin has remained untouched for over three years, while 11% has not been moved for five to seven years.
Crypto analysts view the recent flash crash as a healthy correction for the market, as it eliminated excessive volatility and reset the high funding rates. Funding rates reflect the difference between futures and spot markets, and high funding rates indicate an overly optimistic market sentiment dominated by long traders.
Within 24 hours, Bitcoin managed to recover and surpass the $66,000 mark, coming within 4% of its all-time high.
In an interview with Wolf Of All Streets, there were concerns raised about the possibility of Bitcoin reaching $1 million and the potential implications for the market.