BITCOIN TRANSFER: BINANCE WORRIED AND EXPLAINS ITSELF
Investors are on edge.In a tweet dated November 28, Whale Alert reported the transfer of 127,531 BTC, worth more than $2 billion, from one wallet to an anonymous one. In today's environment, such a large transfer from the world's largest crypto-currency exchange is enough to raise questions for the community. It will need the intervention of Changpeng Zhao, to quell the fear.
The CEO of Binance, which runs the Whale Alert tweet, explained that this transaction will be part of the reserve audit proof. To verify whether Binance actually controls the wallet involved, he reportedly asked the crypto exchange "to send us a specific amount."
Binance is the owner of the two wallets involved in the transaction. It had to make this transfer to demonstrate, in a transparent way, that it had full control over the assets it owned, and that the company could move such a large amount of Bitcoin without the transfer penalizing it from an operational standpoint.
PROOF OF RESERVES: A REALLY USEFUL DEVICE?
After the FTX collapse, crypto exchanges tried to help their customers, including issuing proof of reserves, to prove that platform users' funds are safe. On Dec. 25, Binance announced the launch of a proof-of-reserve system using Merkle for Bitcoin. However, this proof, which should theoretically improve the transparency of cryptocurrency exchanges, is not convincing to everyone in the industry. In his November 25 tweet, former CEO Jesse Powell thus criticized the device, pointing out that it is not a proof of stock and is "either ignorant or a deliberate misrepresentation of reality."
He had harsh words for the tree that did not allow for the necessary checks to ensure transparency without an auditor to ensure that no negative balances were entered. Jesse Powell also pointed out that "the asset statement is useless without the liabilities. To appease the FUD launch, Changpeng Zhao owes his social media posts to the Binance anomaly.
It will be some time before crypto exchanges fail to regain a modicum of trust from their users.
Reserved proof is a tool to achieve this goal, but it still has limitations that affect its effectiveness.
BITCOIN CONTINUES ITS FALL
The king of cryptocurrencies is weak, marking a new low in this complicated context :
Despite the recent new low, the situation remains the same. The $19,000 level will be critical, it has not yet been tested as resistance. If the price gets rejected at this level, the price could fall to the next support at $11,500 . On the other hand, if buyers manage to climb back to $19,000 and break through the trendline, a recovery is possible. Moreover, the institutional trend is down and could each act as a dynamic resistance in the coming days. For now, the price of Bitcoin is bearish.
The momentum is very strong. The stochastic index continues to move above the June low, while the price has dropped to the low. The current movement may just be a deviation. To confirm this, we will have to take back the $19,000 as support.
Since mid-October, the whales have strongly pulled the trigger. These players had been distributing since the beginning of 2021, they have started to change their behavior since May 2022. This does not mean that the price will go back up quickly, but it is interesting to study the behavior of large portfolios.
Investors are on edge.In a tweet dated November 28, Whale Alert reported the transfer of 127,531 BTC, worth more than $2 billion, from one wallet to an anonymous one. In today's environment, such a large transfer from the world's largest crypto-currency exchange is enough to raise questions for the community. It will need the intervention of Changpeng Zhao, to quell the fear.
The CEO of Binance, which runs the Whale Alert tweet, explained that this transaction will be part of the reserve audit proof. To verify whether Binance actually controls the wallet involved, he reportedly asked the crypto exchange "to send us a specific amount."
Binance is the owner of the two wallets involved in the transaction. It had to make this transfer to demonstrate, in a transparent way, that it had full control over the assets it owned, and that the company could move such a large amount of Bitcoin without the transfer penalizing it from an operational standpoint.
PROOF OF RESERVES: A REALLY USEFUL DEVICE?
After the FTX collapse, crypto exchanges tried to help their customers, including issuing proof of reserves, to prove that platform users' funds are safe. On Dec. 25, Binance announced the launch of a proof-of-reserve system using Merkle for Bitcoin. However, this proof, which should theoretically improve the transparency of cryptocurrency exchanges, is not convincing to everyone in the industry. In his November 25 tweet, former CEO Jesse Powell thus criticized the device, pointing out that it is not a proof of stock and is "either ignorant or a deliberate misrepresentation of reality."
He had harsh words for the tree that did not allow for the necessary checks to ensure transparency without an auditor to ensure that no negative balances were entered. Jesse Powell also pointed out that "the asset statement is useless without the liabilities. To appease the FUD launch, Changpeng Zhao owes his social media posts to the Binance anomaly.
It will be some time before crypto exchanges fail to regain a modicum of trust from their users.
Reserved proof is a tool to achieve this goal, but it still has limitations that affect its effectiveness.
BITCOIN CONTINUES ITS FALL
The king of cryptocurrencies is weak, marking a new low in this complicated context :
Despite the recent new low, the situation remains the same. The $19,000 level will be critical, it has not yet been tested as resistance. If the price gets rejected at this level, the price could fall to the next support at $11,500 . On the other hand, if buyers manage to climb back to $19,000 and break through the trendline, a recovery is possible. Moreover, the institutional trend is down and could each act as a dynamic resistance in the coming days. For now, the price of Bitcoin is bearish.
The momentum is very strong. The stochastic index continues to move above the June low, while the price has dropped to the low. The current movement may just be a deviation. To confirm this, we will have to take back the $19,000 as support.
Since mid-October, the whales have strongly pulled the trigger. These players had been distributing since the beginning of 2021, they have started to change their behavior since May 2022. This does not mean that the price will go back up quickly, but it is interesting to study the behavior of large portfolios.
BITCOIN IN DANGER UNDER $19,000
After falling below support at $19,000, Bitcoin (BTC) touched $15,500. Since then, BTC has been losing volatility and buyers don't seem to be coming.
On a daily basis, Bitcoin is in a bearish trend. For now, the price is stuck at the institutional bearish bias. If there is a bounce, btc could head to the $19,000 resistance area.
This has been a support for several months, but the FTX case has caused BTC to fall below this important area.
For buyers, the goal is to regain support at $19,000 .
This is also the 0.382 Fibonacci retracement , it is often rejected at this level in a downtrend.
On the contrary, if the trend eases, and sellers lose steam, the level could give way.
In case the fall is not over, the price could fall back to the support level at $11,500.
This would imply a 30% drop from the current price. If this scenario takes place, altcoins would also fall.
Bitcoin miners are facing a complicated situation, they have to sell some of their Bitcoin inventory. This is starting to look like capitulation, but this situation may not be over.