First Mover Asia: Bitcoin Whales Are Increasing, but BTC Sent to Exchanges Continues to Fall. What Does the Trend Mean?

Good morning. Here’s what’s happening:

Prices: Jobs and services reports sent bitcoin plummeting below $30K before, although the crypto later regained this threshold. Sentiment has been increasingly bullish, a market observer wrote to CoinDesk.

Insights: Large bitcoin holders are increasing, but BTC sent to exchanges are sinking. Is the trend bullish?

Prices

A Bitcoin Break From Recent Bullishness

CoinDesk Market Index (CMI) 1,227 −20.5 ▼ 1.6% Bitcoin (BTC) $30,109 −382.4 ▼ 1.3% Ethereum (ETH) $1,853 −59.1 ▼ 3.1% S&P 500 4,411.59 −35.2 ▼ 0.8% Gold $1,916 +7.0 ▲ 0.4% Nikkei 225 32,773.02 −565.7 ▼ 1.7% BTC/ETH prices per CoinDesk Indices, as of 7 a.m. ET (11 a.m. UTC)

Crypto investors inferred more from an unexpectedly torrid ADP private sector jobs report and surprisingly robust ISM Services Index than a softer job opening survey.

They sent bitcoin tumbling below $30,000 for the first time in almost two weeks. The largest cryptocurrency by market capitalization had recently surged back to $30,100, down 1.3% over the past 24 hours. The decline followed just hours after bitcoin hit a new three-month high above $31,500, a continuation of investor bullishness stemming from multiple spot bitcoin ETF filings last month.

Markets have become increasingly hopeful that the U.S. Securities and Exchange Commission (SEC), will reverse its pattern of rejecting the applications by some of the world’s most prominent financial services firms. But on Thursday, concerns about economic growth, a precursor to inflation, trumped any euphoria.

Ether followed a similar downtrodden path, sinking quickly from a high above $1,950 after the ADP report, which showed the private sector adding 497,000 jobs, more than double forecasts. The ISM Services Index rose to 53.9 in June, higher than the 51.2 consensus estimate and May’s 50.3 reading. The reports fresh fuel for the U.S. central bank to justify additional rate cuts in its quest to tame inflation. Such hawkishness has often weighed heavily on crypto and other asset markets, fretful that the Federal Reserve will throw the economy into a steep recession.

Investors were less impressed by May’s Job Openings and Labor Turnover Survey (JOLTS) report, which showed job vacancies sinking to 9.82 million, down from an upwardly revised 10.3 million in April.

ETH, the second largest crypto in market value, was recently changing hands at $1,853, a 3.1% drop from Wednesday, same time. Most other major cryptos plunged deeply into the red before regaining some ground. Litecoin and popular memecoin SHIB were still off more than 6% and 3%, respectively. SOL, the token of the Solana blockchain soared over 11% at one point and was still up more than 4%. The CoinDesk Market Index, a measure of crypto markets overall performance, was recently down 1.7%.

Asia equity markets were down in early trading, with the Hang Seng and Nikkei off about 1% and 0.5%, respectively. They followed declines in U.S. indexes with the tech-focused Nasdaq and S&P 500 both sinking 0.8%. Meanwhile, yields on 2- and 10-year U.S. Treasurys both rose, and safe haven gold edged up.

In an email to CoinDesk early Thursday, Richard Mico, U.S. CEO of Banxa, a crypto payment and compliance infrastructure provider, noted bitcoin’s support at $30,000 amid the spot BTC applications and a range of positive signals, technical and otherwise.

“We could still have a rate hike or two ahead of us, but the Federal Reserve certainly appears to be closing in on peak rates if not already reached,” Mico wrote. “We’ll likely have to wait until next year’s Bitcoin halving to experience full-on bull mode, but we’re getting closer by the day and many are keen to front-run what they expect will be a continued uptrend.”

He added: “The market is reflecting an increasingly optimistic sentiment and the next 18 months are going to be very exciting.”

Biggest Gainers

Biggest Losers

Insights

Whale Activity a Bullish Signal?

Despite a recent increase in bitcoin whales, large BTC holders remain reluctant to move assets on to centralized exchanges, Glassnode data shows.

Bitcoin whales, and whales moving assets on to exchanges have taken separate paths, as large investors seem wary of moving their assets out of cold storage.

Bitcoin investors are likely cautious about exchange risk, regulatory hurdles, or a combination of the two.

The combination of large entities holding increasing bitcoin supplies and a decreasing supply to exchanges indicates bullishness among investors.

This article was written and edited by CoinDesk journalists with the sole purpose of informing the reader with accurate information. If you click on a link from Glassnode, CoinDesk may earn a commission. For more, see our Ethics Policy.

Important events.

1 p.m. HKT/SGT(5 a.m. UTC): Japan Leading Economic Index (May preliminary)

8:30 p.m. HKT/SGT(12:30 p.m. UTC): U.S. Labor Force Participation Rate (June)

8:30 p.m. HKT/SGT(12:30 p.m. UTC): U.S. Nonfarm Payrolls (June)

CoinDesk TV

In case you missed it, here is the most recent episode of “First Mover” on CoinDesk TV:

Yat Siu on Hong Kong’s Web3 Development; Circle Mulls Issuing Stablecoin in Japan

Yat Siu, Animoca Brands co-founder and executive chairman, joined “First Mover” to discuss the state of Web3 progress in Hong Kong after being appointed to a new task force focused on the sector. Circle is considering issuing a stablecoin in Japan. Todd Groth, CFA, CoinDesk Indices head of research reflected on bitcoin’s performance in the second quarter. And, Ripio CEO Sebastian Serrano discussed the crypto services provider’s approval to operate in Spain as an exchange.

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Edited by James Rubin.