What people are saying about Bitcoin being in a bear market. They're saying that $62K was the exact top for Bitcoin, which was, by the way, 3x it's previous all-time high in 2017, so still not too shabby. But what are the reason people are saying this? Well first and foremost, a very troubling statistic in the amount of Bitcoin wallets that hold more than 1000 Bitcoin. We've seen the largest drop in these addresses in the history of Bitcoin.
These wallets called whale wallets are often indicators of big money coming into crypto. Throughout the bear and the bull market, after finding a bottom, these addresses had continually increased over time, never seeing a drop like this is such a short amount of time. But is this really a big deal? Well, i dug deep and found some interesting stats to go along with it. First the number of whale addresses with over 10K BTC has already been in decline for a while, and i mean that kind of makes sense.
There certainly aren't a ton of people opening new addresses with that much BTC with it hovering around $60K. So basically, this means anyone who sells down to below 1000 bitcoin gets lost from the statistic probably forever, which means that it can be a little misleading. But here's where things get very interesting. The number of Bitcoin wallets holding over 100 bitcoin is actually on an uptrend
and just recently saw yet another spike.
This spike seems to coincide with the decreasing number of addresses with over 1000 Bitcoin. What can we surmise from this? Well, it seems to me that as the price of Bitcoin is rising dramatically, whales are diversifying their addresses, and we could be seeing some of the big time custodian solution doing this as well. The more addresses you have, the better in mu opinion. At least if one address got hacked, you can be safe in other places. But something else to think about is that we've never seen a gigantic whale address drop that coincides with the end of a bull market. Whales are smart. They dollar-cost average out for profits over time. So they will be taking profits all throughout the bull market, not waiting for some warning sign to get out. On the flip side though, some people are saying we do have a gigantic warning sign that we need to pay attention to. And it's called the Pi chart. And we aren't talking pecans. Meet the Pi Cycle too indicator.
At first glance, this looks like a pretty chart, but it's hiding a dark secret, the top of the bull run. In history, this chart has been deadly accurate in picking out the top of bull cycles. The shortened version of you're looking at on this chart is that when the green line touches the orange line, the top is in and the most it's ever been off by is three days. Now as you can see with the image zoomed into the last month, these two lines are extremely close to touching each other, which would basically be a death cross.
So, what are we looking at right here? The blue line is, of course the Bitcoin price. The orange line is the 111-day moving average. And the green line is the 350-day moving average. When this two lines cross it's a death cross indicating the top of the market. So why call it Pi? Well, when you divide 350 by 111, the number is very close to Pi, 3.14. Specifically, 3.142 is what 350 divided 111 gives you. Look into bitcoin.com points out that when you divide 350 by any number 111 is the closest number that will derive the equivalent of pi. But all you really need to know here is this quite worrisome, honestly. Here's the thing. While we're extremely close to a cross, the lines have not actually crossed. We need Bitcoin to move up in the next few days. I can actually see the lines touching and not actually crossing due to large Bitcoin move to the upside. But next week, if the price of Bitcoin were to go down below say $50K or so, we could be in big time trouble for the bull market. And I do have to say this as we get from the bearish and bullish scenario. There certainly is a scenario that exists like what we saw in 2013, a distinct two-part bull cycle. This will be a bull run up maybe to $80K or $100K or so, and a large dip of 50% before a full recovery and real moon show later this year.
The reason for this could be some type of large catalyst event like a stock market crash, or something similar. But as of right time there's nothing really in my opinion to indicate a gigantic crash like that. It is possible though, so keep that in mind.
This does seem to be a noteworthy short-term concern; thank you for sharing this information. On a different note, what do you think the price of bitcoin in terms of U.S. dollars will look like in the next 5 years? Do you think more individuals will purchase bitcoin as U.S. dollar value goes down?