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Bitcoin experiences a significant drop to $115,000 amid a massive sell-off by Galaxy Digital, which unloaded over 12,800 BTC worth $1.5 billion within 24 hours.
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Long-dormant Bitcoin wallets have reactivated recently, moving millions in BTC and adding to market uncertainty about future price movements.
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According to COINOTAG source Lookonchain, the sell-off originated from a legendary whale holding 80,009 BTC, sparking concerns about potential further market volatility.
Bitcoin falls to $115K as Galaxy Digital sells $1.5B in BTC; dormant wallets reawaken, while Bitcoin dominance dips, hinting at a possible altseason ahead.
Galaxy Digital’s Massive BTC Sell-Off Drives Market Volatility
Bitcoin’s recent decline to the $115,000 level is largely attributed to the intense selling pressure from Galaxy Digital, which moved over 12,800 BTC to exchanges in just 24 hours. Blockchain analytics firm Lookonchain highlighted that Galaxy Digital deposited 2,850 BTC valued at $330 million early on Friday, adding to a broader liquidation spree totaling $1.5 billion. This activity originated from a prominent whale wallet containing 80,009 BTC, worth approximately $9.6 billion before the sell-off began. The whale began transferring coins to Galaxy Digital on July 15, completing the full transfer by July 18, with over 40,000 BTC moved in a single day. This unprecedented movement has unsettled traders and contributed to Bitcoin’s short-term price weakness.
Market Reactions and Trader Sentiment Amid Sell-Off
Despite the bearish pressure, some market participants remain optimistic. As Galaxy Digital’s sell-off appears to be tapering, traders anticipate a potential rebound. On social media, influential voices like SalsaTekila encourage buying the dip, suggesting that Bitcoin could soon resume its upward trajectory. However, the market remains cautious as the sell-off has injected significant volatility, and the full impact on Bitcoin’s price stability is yet to be determined.
Reactivation of Dormant Bitcoin Wallets Adds to Market Uncertainty
Adding complexity to the market dynamics, several long-inactive Bitcoin wallets have recently become active. SpotOnChain reported that three wallets, likely controlled by a single entity, moved 10,606 BTC worth $1.26 billion this week. These wallets originally received their BTC in December 2020, when Bitcoin was priced at $18,803, marking a 6.3x gain at current prices. Furthermore, Lookonchain identified a whale wallet dormant for 14.5 years that transferred 3,962 BTC ($468 million) to a new address, one of the oldest known reactivations. Another wallet moved 6,000 BTC after six years of inactivity. These movements suggest that long-term holders are repositioning their assets, potentially preparing for market shifts.
Implications of Dormant Wallet Activity on Bitcoin’s Price Outlook
The reawakening of these aged wallets has sparked speculation within the crypto community about possible upcoming sell-offs during the next bullish phase. Analysts note that such activity often precedes increased volatility as old supply transitions to short-term holders or exchanges. This trend, combined with Galaxy Digital’s liquidation, points to a changing market landscape where previously inactive holders may influence price dynamics. Traders are closely monitoring these developments to gauge whether the selling pressure has peaked or if further downside risks remain.
Declining Bitcoin Dominance Signals Potential Shift Toward Altcoins
Concurrent with Bitcoin’s sell-off, the Bitcoin dominance index has fallen from 64% to 60% between July 17 and July 21, indicating a rotation of capital into altcoins. This decline suggests that investors are diversifying their portfolios, seeking opportunities beyond Bitcoin. Although the dominance index showed a slight recovery to 61.55% recently, the downward trend aligns with early signs of an emerging altseason. The Altcoin Season Index currently stands at 43, reflecting that the market is not yet fully in altseason but is trending in that direction.
Bitcoin Dominance. Source: TradingView
Altcoin Season Index. Source: Blockchain Center
Capital Rotation and Market Momentum
The shift in dominance underscores a broader market momentum where altcoins are gaining investor interest, potentially setting the stage for significant price appreciation in alternative cryptocurrencies. This capital rotation often precedes increased trading volumes and volatility in altcoin markets, offering traders new opportunities. Market participants are advised to watch these indicators closely as they may signal the next phase of crypto market cycles.
Conclusion
Bitcoin’s recent price decline to $115,000, driven by Galaxy Digital’s substantial sell-off and the reactivation of dormant whale wallets, has introduced notable volatility and uncertainty in the crypto market. Meanwhile, the decline in Bitcoin dominance points to a growing interest in altcoins, hinting at a possible altseason on the horizon. While Bitcoin’s fundamentals remain robust, these developments emphasize the importance of monitoring whale activity and market sentiment closely. Investors should stay informed and consider diversification strategies as the crypto landscape evolves.
