In a week that saw Bitcoin (BTC) fall to lows of $49,000, volatility went through the roof, a scenario last seen during the collapse of crypto exchange FTX two years ago.
This development triggered extreme fear, which, as Santiment acknowledged, proved pivotal in boosting Bitcoin’s recovery.
The renowned crypto analytic firm stated, “Bitcoin’s rapid bounce back to $57K came immediately after social media proclaimed we were about to see $40K-$45K BTC again. Instant bounces after bearish sentiment is a common theme throughout 2024.”
Source: Santiment
Bitcoin is back to winning ways, given that the leading cryptocurrency briefly crossed the $62,500 mark thanks to a 25% surge in just 3 days.
Even though BTC had retraced to the $60,351 level at the time of writing, Santiment believes this might be the calm before the storm as the apex cryptocurrency might experience sudden increased excitement that will push the price to the $70K-$75K zone.
Source: Santiment
Therefore, this development is highly likely to invalidate the chances of Bitcoin falling to the $40K-$45K level in the short term.
Are Whales Playing a Hand in Bitcoin’s Recovery?
Based on the recent bloodbath in the Bitcoin market, whales took advantage and bought the dip. Their accumulation spree hit a four-month high, which has been instrumental in BTC’s recovery.
Santiment pointed out, “According to the total holdings of wallets with 10 to 1,000 BTC, they rapidly accumulated on the price dip that saw crypto’s top asset fall below $50K.”
Source: Santiment
Similar sentiments were shared by leading market analyst Ali Martinez, who noted that the number of addresses with more than 100 BTC surged from 15,913 to 16,006 during the recent correction, signaling that whales were on a buying spree.
Source: Glassnode
Meanwhile, Bitcoin continues to make airwaves, given that US presidential Candidate Donald Trump recently floated the idea of using the cryptocurrency to pay off the nation’s $35 trillion debt.
