Bitcoin Sales from Silk Road and Ethereum’s Quarterly Earnings: A Crypto Market Analysis

Following a correction, Bitcoin regained some ground, and other digital assets also showed positive trends. The current market is highly sensitive to news, prompting ForkLog to analyze recent events and gather expert opinions on the industry’s state. 

Sales and Purchases

On April 2, a U.S. government-controlled wallet initiated a transfer of approximately 2,000 BTC (~$131 million) to a Coinbase Prime address. The community speculated that the authorities might be selling some of the assets confiscated from the Silk Road darknet marketplace. 

Although such a transaction could have unsettled traders, the market remained calm, showing relatively positive daily dynamics. 

Throughout the day, Bitcoin rose from approximately $64,500 to $66,600 — a 3.5% increase. At the time of writing, the asset is trading around $66,000, with a market capitalization of $1.29 billion, according to CoinGecko.

Most assets in the top 10 also entered the “green zone.” Solana (SOL) showed the largest increase, gaining 5.5% over the day. 

MN Trading founder Michaël van de Poppe noted that “at peak bullish momentum,” a bearish narrative, such as the U.S. government’s sale of Bitcoin, has a “huge impact” on investor sentiment.

In every market, we’ve got bullish and bearish narratives.

At peak bullish momentum, you’ll see a huge impact of every bearish narrative.

This time, it’s the Silk Road #Bitcoin being transferred.

I’m happy they do it, bring them back on the markets.

Anyway, buy the dip.

— Michaël van de Poppe (@CryptoMichNL) April 2, 2024

“I’m glad [the U.S. government] is doing this, bringing [assets] back to the markets. Anyway, buy the dips,” he added. 

Regarding Bitcoin purchases, the trading figures of spot Bitcoin ETFs overshadow the presumed sale of confiscated Bitcoins. According to SoSoValue, on April 2, the net inflow into exchange-traded funds was $39.4 million, compared to an outflow of $85.8 million the previous day.

March set a record for spot Bitcoin ETF trading volume, nearly tripling from the previous month — from $42 billion to $111 billion. 

A trader known as Jelle noted that on the weekly chart, Bitcoin retested the highest available support and formed a bullish pennant.

#Bitcoin broke all-time highs, retested highest weekly support available, and formed a bullish pennant.

This looks primed for continuation, higher.

$82,000, then $100,000. Let’s go. pic.twitter.com/V2hoOxxVPO

— Jelle (@CryptoJelleNL) April 3, 2024

He suggested the asset could rise in the medium term to $82,000, and then to $100,000. 

$BTC 4H
GM

Nice sweep of the lows & good buyback reaction

need follow through from buyers now pic.twitter.com/VR9VZKteNF

— Skew Δ (@52kskew) April 3, 2024

“Nice sweep of the lows and good buyback reaction. Now we need follow-through from buyers,” noted trader Skew.

More Stablecoins

The combined market capitalization of the three largest stablecoins — USDT, USDC, and DAI — increased to $141.42 billion, the highest level since May 2022, writes CoinDesk.

According to a Reflexivity Research report, the ongoing expansion of stablecoin supply, reflecting liquidity levels, is a positive sign for the crypto market.

“As [stablecoin volume] continues to grow, it demonstrates ongoing capital inflow into the industry,” experts explained.

Over the years, stablecoins led by USDT have become the primary mechanism for purchasing cryptocurrencies on the spot market and trading derivatives. Traders use them to lock in profits and then typically buy at lows. 

Additionally, the MVRV Z-score indicator is at 2.87. This suggests that Bitcoin is far from being overbought, indicating prospects for long-term growth.

Ethereum Earnings

According to Coin98, Ethereum’s blockchain net profit in Q1 reached $369 million — tripling compared to the previous reporting period.

#Ethereum Q1 2024 Financial Report

In the first quarter of 2024, most income statement metrics show positive growth signs:

— Fees & Revenue increased nearly 1.8 times QoQ
— Earnings tripled QoQ#ETH $ETH pic.twitter.com/9BpI0KEmhu

— Coin98 Analytics (@Coin98Analytics) April 3, 2024

The network’s success was recorded as Ethereum’s prices approached an all-time high, triggering a significant spike in network fees.

According to the study, the total number of transactions on the blockchain in Q1 exceeded 107 million, increasing by 8.4%. Over this period, more than $1.1 billion was spent on fees.

Over three months, more than 9.7 million new addresses were created in the ecosystem. 

The total value locked in Ethereum’s DeFi ecosystem rose by 86% compared to the previous period — to $55.9 billion.

ETH itself recovered after a correction to $3,350, adding 2% in 24 hours. Its market capitalization stands at $402 billion.

Experts at Glassnode have observed movements of “dormant” Bitcoins. According to their observations, investors are successfully executing a distribution cycle, realizing profits and activating coins to meet new demand.

Previously, Bernstein considered the correction to around $63,000 a good buying opportunity “at the lows” before the halving. Subsequently, experts revised their Bitcoin forecast — from $80,000 to $90,000 by the end of the year.