Last week, after a slow grind up to its most recent peak of roughly $7,400, Bitcoin’s price plummeted over 20% in less than 48 hours. All signs had pointed to a slow, steady recovery for the cryptocurrency market, leaving investors shocked as recent gains evaporated before their eyes. This prompted the cryptocurrency community to do what they do best: speculate. Speculation ran wild, and internet sleuths discovered a wallet transaction trail leading back to a mysterious bitcoin whale that dumped a large sum of bitcoins on the market.

Reddit Goes Bitcoin Whale Watching

After much debate on Reddit and other social media platforms, users turned detectives discovered a cryptocurrency wallet dating back as far as 2011 was on the move. The Bitcoin whale’s original wallet at one point had 111,114 Bitcoins, but was distributed to a number of smaller sub-wallets over time. Reddit user u/sick_silk found that “at least 15,593 BTC,” worth over $100 million at the time of the selloff, was sent to wallets at Bitfinex and Binance – two of the world’s largest cryptocurrency exchanges by trading volume.

The coins were transferred between August 24 and September 2, just days prior to the massive sell-off on September 5 when Bitcoin’s price neared the current bear market downtrend line, plummeting over 20% in two days.

Bitcoin Blast From the Past: Mt. Gox or Silk Road?

Given the timing of the wallet original funding date of June 21, 2011, speculation led to the cryptocurrency community pointing fingers at two potential sources: defunct and hacked cryptocurrency exchange Mt. Gox, or a wallet potentially tied to convicted Silk Road head Ross Ulbricht.

Speculation suggests that the wallet could have been Mt. Gox trustees selling Bitcoins to pay back creditors. Mt. Gox trustee Nobuaki Kobayashi has reportedly been responsible for previous Bitcoin price declines at key peaks throughout the 2018 crypto bear market.

Another potential source could have been related to dark web drug den Silk Road. A BitcoinTalk forum post dating back to October 2013 noted on what was presumed to be a Silk Road related wallet that had around 111,114 BTC in it “with nothing spent.”

However, it could just has easily been an early Bitcoin adopter frustrated with declining prices who finally decided to sell their holdings. Thanks to Bitcoin’s pseudo-anonymous design, the owner of the wallet may never been known.

Crypto Investor Over-Reaction to Media-Driven FUD

Per usual, shocked cryptocurrency speculators sought out news that they believed could coincide with, or may have been responsible for large price movements. In this case, that speculation was further fueled by mainstream media outlets reporting that the sell-off was due to the market’s reaction to Goldman Sachs reportedly delaying their cryptocurrency trading desk for the foreseeable future.

Neither the correlation or even the news itself turned out to be true. Goldman Sachs CFO Marty Chavez told TechCrunch while speaking at the recent Disrupt San Francisco Conference that the Goldman Sachs report was “fake news.” Later, the evidence of the Bitcoin whale was discovered, throwing a wrench in the theory that the sell-off was related to the Goldman Sachs non-event.

Charts further disprove the theory, showing that the Goldman Sachs false sell-off had occurred mid-way through this Bitcoin whale’s coin dump. This serves as a shining example of how cryptocurrency bear market has seemingly weakened the previously strong hands of cryptocurrency “hodlers,” who are too often overreacting to FUD-focused news from mainstream media.

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