Bitcoins biggest early holders, often called original gangsters, hit the sell button after the Federal Reserve rattled expectations of lower borrowing costs.
Blockchain data tracked by Lookonchain shows that at least two long-term owners together dumped over 1,650 BTC worth more than $117.87 million early Thursday.
A veteran whale who previously sold an 11,000-BTC stack added another 650 BTC to his dump, while a separate early adopter OG with a 5,000-BTC stash unloaded a whopping 1,000 BTC.
Bitcoin’s price fell nearly 1% to $70,600 shortly before press time, extending Wednesday’s 3.5% slide from $74,500, according to CoinDesk data. The broader market wilted, with the CoinDesk 20 index down 3% to 2,056 points. Ether (ETH), XRP (XRP), solana (SOL) and somewhat similar losses.
The drop followed a hawkish Fed rate decision on Wednesday, in which the central bank left benchmark borrowing costs unchanged in the 3.5%-3.75% range but signaled a slower pace of rate cuts ahead, disappointing risk-asset bulls.
The hawkish tone came through the so-called interest rate “dot plot”, which shows where the Fed’s voting members expect interest rates to land in the coming months. The median projection indicated just one rate cut this year despite recent weakness in the labor market. Moreover, only two committee members remained in the bipartisan camp, and Chairman Powell’s own personal projection moved higher.
“The higher-for-longer narrative has been revived by sticky inflation and the inflationary shadow cast by rising energy costs, forcing investors to abandon their dreams of a rapid easing cycle,” Matt Mena, crypto research strategist at 21shares, said in an email.
Taken together, these developments pointed to a central bank still wary of inflation, and that has led to a sharp repricing of bets on Fed rate cuts. Trading on the decentralized platform Polymarket and pricing in CME Fed funds futures now implies about an 80% probability of just one rate cut this year, compared to a 62% probability of two to three rate cuts a month ago.
These prospects for tighter liquidity do not support risk-taking in the financial markets.
