Simply put
- Recent on-chain data indicates a notable increase in whale profit acquisition since mid-2024, following the record peaks in July.
- Options traders are targeting a potential 10-30% decline in the market before September.
- Edwards from Capriol claims Bitcoin is “undervalued,” pointing to the historical trend of strong returns in the fourth quarter.
Bitcoin seems to be in a tug-of-war between those making profits and long-term holders.
After peaking at 123,300 on July 14, the crypto market has dipped while waiting for a new catalyst.
A report from Cryptoquant stated that this pullback marks the third substantial wave of whales securing profits since mid-2024.
Shawn Dawson, head of research for an on-chain options platform, supports this observation, noting profits are coming from both “old and new whales.”
In crypto lingo, “whales” refers to large holders whose transactions can significantly influence asset prices.
Dawson also pointed out that selling pressure isn’t just from whales; miners sold around 15,000 BTC shortly after the new record high.
“The magnitude of these transactions indicates that institutional investors are likely securing their returns and trying to mitigate risks given an uncertain Q3 ahead,” he remarked.
This cooling phase seems typical of a mature bull market and is consistent with Bitcoin’s past behavior, where the third quarter usually results in modest returns.
Dawson believes the market is bracing for this, mentioning that options traders are implying they “have roughly two months” now by purchasing options with strike prices of $80,000, $95,000, and $100,000 for August and September.
These traders “hope to see a price reversal between 10-30% next month,” Dawson added.
On the other hand, Charles Edwards, from Capriole Fund, highlighted a divergence from short-term pessimism, claiming Bitcoin is undervalued when considering an energy value model.
This model links Bitcoin’s intrinsic value to the energy expenditure of mining operations, suggesting that the asset is significantly undervalued.
Cryptoquant forecasts a “resurgence in accumulation and a breakout to new highs,” backed by historical data that shows Bitcoin traditionally performs well in the fourth quarter, often yielding a median return of around 52%.
