With more than $650 million in Bitcoin and Ethereum sent to Coinbase Prime, BlackRock has created the possibilities about an intense sell-off. The move comes as the crypto market continues to decline.
The move comes at a time traders are already watching Bitcoin slip below key support levels and Ethereum lose momentum after a brief recovery. At the same time, Strategy continued to expand its Bitcoin position, adding another layer of contrast between institutional moves.
BlackRock Wallet Movements Trigger Crypto Market Panic
According to Lookonchain data, big crypto flows occurred via BlackRock-related wallets. The IBIT Bitcoin ETF and the Ether Ethereum ETF sent 4,880 BTC (about $467 million dollars) and 54,730 Ether (about $176 million) to Coinbase prime.
The two transfers occurred within an hour raising speculations about liquidation risks. These have happened after a new record outflow by the BlackRock Bitcoin ETF.
Cryptocurrency analyst Ted Pillows affirmed the amounts and described the action as more selling. These flows were also termed by a market watcher as a huge sell-side pressure. According to him, institutions do not send a half-billion worth of crypto to an exchange without purpose.
Soon after the transfer, BTC price dropped to around $94,000, with the weekly drop being more than 10%. Ethereum also weakened and is now trading near $3,140 after briefly outperforming earlier in the session.
ETF Withdrawals Hit Bitcoin and Ethereum Hard
The move also comes during the largest digital asset fund outflows since February. CoinShares data shows Bitcoin investment products saw $1.38 billion in outflows last week, while Ethereum lost $689 million. That marks three straight weeks of withdrawals for both assets, driven by monetary policy uncertainty and whale-led selling.
Ether lost more percentage-wise. The weekly outflows was 4% of its AUM compared to 2% in the case of Bitcoin. The imbalance means that there is a strong drop in confidence in ETH among institutional investors.
Meanwhile, Strategy purchased 8,178 BTC. The Michael Saylor-led firm took opposite position to BlackRock in spite of the crypto market jitters.
BlackRock has not indicated on whether the purpose of the transfers is to sell or not. Issuers of ETFs usually transfer funds to exchanges for settlement or rebalancing. The transfers may be for operational reasons, but its time shows it is set up by anticipation of redemptions.
Market Sentiment Hits Extreme Fear Levels
The move arrives during an already fragile period for crypto. Liquidity has thinned across major exchanges, leverage has unwound.
Hence, any significant sale by a top ETF issuer could accelerate declines and send sentiment deeper into fear. A recent analysis by BitMine executive Tom Lee stated that the recent Bitcoin decline is due to balance sheet holes among major market makers.
Sentiment has now collapsed into extreme fear. The Bitcoin Fear & Greed Index has plunged to 14, one of the lowest levels seen since early March.
Source: https://coingape.com/crypto-news-blackrock-deposits-millions-in-btc-and-eth-on-coinbase-while-strategy-scoops-more-bitcoin/
