For the first time in Bitcoin’s history, a staggering $8.9 billion in Bitcoin was moved on-chain in just an hour. This has been the highest hourly USD transaction volume the Bitcoin network ever recorded.
On this move, investor and bitcoin bull Preston Pysh commented, “That kind of move is not characteristic for the price action or protocol adjustment that's currently happening.”
More of these Big Transfers Expected
Popular analyst PlanB who is known for applying the stock-to-flow model to Bitcoin contemplated this to be exchanges, miners or whale reshuffling their BTC before the Bitcoin reward halving in May 2020.
With just about five months left in the block halving, the analyst is expecting to see more of these big moves.
“I was actually waiting for some transactions with very large numbers of BTC. They happened around block 200,000 and 400,000 (spikes in the chart) but nothing at 600,000 .. until now. I expect more of those,” said PlanB.
Low Fees Behind the Transfer?
As for why before the halving, PlanB said it could be because of the fees. Before the next leg up when fees will probably rise again, exchanges and whales that have huge amounts of BTC might be looking to reshuffle while fees are still low.
Although the third reward halving will cut down the miner’s reward from the current 12.5 BTC to 6.25 coins, the fees have only risen over the years, especially after halving during the bull market.
In 2012, before the halving on Nov. 28, the fee on Bitcoin Network was below $0.01 only to rise to $0.181 in April 2013, $0.555 in Sep. and $0.659 in November of the same year.
In late 2015, the fees were down to $0.024 when the uptrend resumed. Around the second halving in 2016, the fees kept on surging yet again to top at $55 in December 2017. Currently, we are down at $0.64.
Major Exchanges Hoarding 1.9 Million BTC
According to data company Glassnode, the transactions have been, in fact, made by a crypto exchange.
Crypto exchange Bittrex moved a large amount of Bitcoin several times — “a series of 21 transactions within one hour, each moving ~56,000 BTC.”
Bittrex has a total of 131k BTC stored with it. Coinbase however, has even a much higher supply of Bitcoin in its custody, over 966k BTC. Coinbase is followed by BitMEX with about 265k BTC and then Bitstamp with nearly 230k BTC, Bitfinex 146k BTC, and Kraken at 136k BTC.