- The difference between miners’ daily earnings and 365 days of SMA has widened since the start of 2023.
- Data on US government BTC holdings has not shown any decline since early May.
Bitcoin [BTC] posted losses for the second day in a row and fell to its lowest level in nearly two months. At the time of writing, the coin was trading hands at $26,332.73, a sharp drop from the $28,000 level reached just two days ago.
Read Bitcoin [BTC] Price Forecast 2023-24
As BTC sneezed, the broader crypto market went cold. Major assets traded in the red and the global crypto market cap fell nearly 3% from the previous day, data from CoinMarketCap revealed.
Much of the selloff was driven by FUD triggered by news that the US government would be divesting its BTC holdings. However, it turned out that the rumors turned out to be false.
The era of disinformation
Blockchain analytics firm CryptoQuant described the attempt to spread fake news about the US government’s sale of Bitcoin as “coordinated”, with many popular accounts retweeting the news without any fact-checking.
While rumored far and wide, it resulted in the second-largest liquidation for BTC in 2023, with positions worth $36 million being liquidated within an hour on May 10.
Coordinated FAKE NEWS on US Government Selling of Bitcoins Lead to Second Largest Liquidations in 2023
“Many accounts retweeted this news without any fact-checking, and as a result, we saw the second largest liquidations in 2023, with over $36 million coming in… pic.twitter.com/mfyglR8M8m
— CryptoQuant.com (@cryptoquant_com) May 11, 2023
Moreover, data on US government BTC holdings has not shown any decline since early May. This confirmed the falsehood of the rumor.
The statistic, developed by Glassnode, corresponds to the amount of BTC held at addresses monitored by authorities. The data was obtained from publicly available information.
Source: Sentiment
More bearishness for BTC?
BTC’s Open Interest (OI), or the dollar value of active trading positions on the futures market, is up 1.36% in the past 24 hours, according to data from Coinglass.
This formed a divergence with falling prices. It indicated that new short positions were being opened.
Source: Coinglass
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The Longs/Shorts ratio for BTC further confirmed the idea. In the past 24 hours, the ratio dipped sharply below 1. This implied that more traders were targeting price losses compared to those who were targeting price gains.
Source: Coinglass
In addition, the latest event has revived the debate about Bitcoin’s risk factor. The decoupling of equity markets showed that the largest tradable digital asset moves more on speculation and rumor than on macroeconomic factors.