Was the Massive Bitcoin Rally Engineered by a Single Whale? Possibly

Tony "The Bull" Severino

4 years ago

3 mins read

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Yesterday, Bitcoin broke above $10,000 with a $1,500 daily price candle and a push to above $11,400 at the high. During the rally, however, there was evidence of a whale manipulating the crypto market for maximum profit.

Was this whale responsible for the Bitcoin pump, or were they simply well prepared in advance to take advantage of any major market movements?

Strategic Whale Makes Big Splash, Bigger Profit From Bitcoin Market Manipulation

Bitcoin price had been trading in a tight, sideways range for three months, but this week finally broke free and released pent up momentum. The rally propelled Bitcoin through resistance at $10,500 with ease, sending the crypto asset rocketing higher above $11,000 and beyond.

At the daily peak, BTCUSD had tapped $11,419 on Coinbase Pro. It was that exchange that was potentially used as part of a whale’s sinister strategy to capitalize on the pump by manipulating the market.

Whales and other market makers have the ability to move the market with their large-sized positions and enormous capital. One particular whale was spotted late in yesterday’s Bitcoin surge, using the index price of Bitcoin to make a huge splash on a completely different exchange.

According to order book data from crypto derivatives trading platform BitMEX, a whale was seen going short $44 million worth of BTC across 22 separate orders.

Sell 44 million over 22 separate orders on mex. Get into posistion.

Then, market dump 1000 coins on Coinbase with max slippage to move index price.

I think we just saw someone do some crazy shit and make a ton of money. pic.twitter.com/5OkCX9KmjO

— lowstrife (@lowstrife) July 27, 2020

Moments after the position was filled to the whale’s satisfaction, a 1000 BTC market dump took place on Coinbase Pro, causing the BitMEX index price to crash.

BitMEX, a derivatives platform, utilizes a funding method tied to an index price that pulls from multiple sources such as crypto exchanges. If the price of the index deviates from spot price on these platforms, funding will adjust until the index price comes back to equilibrium.

But because BitMEX index price is based on Coinbase Pro and other platforms, it can be used to the right strategic actor’s advantage.

While it is impossible to know for certain, that appears precisely what took place. Such a sizeable leveraged short position coinciding with the rejection from above $11,400 could have led to substantial profits being made.

Bitcoin BTCUSD Whale Manipulation | Source: TradingView

The initial rejection dropped Bitcoin’s price back to $10,800. Short orders began filling from $11,000 and up.

This isn’t the first time a single whale or strategic actor has been speculated to be responsible for a major Bitcoin pump. Back in April 2019, research showed that the rally may have been the result of a single actor with well-timed buy orders on multiple exchanges during the late, low-volume hours of the night.

That pump took Bitcoin from $4,000 to $14,000 before it reversed, with whatever whale behind it taking profits all the way up.

If the last time around is any indication of what’s to come, this pump may only be just beginning, and this whale will strategically take the largest amount of profit using manipulation at each major pullback.

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

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Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.

Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.

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