Whale Sell-Off Wipes Out Bitcoin’s Powell-Driven Gains in Flash Crash
Bitcoin plunged sharply on Sunday after a major holder dumped 24,000 BTC into thin weekend liquidity, erasing gains fueled by Federal Reserve Chair Jerome Powell’s dovish remarks just days earlier.
The sell-off triggered a rapid decline of over 2%, with BTC falling from $114,666 to $112,546 within ten minutes by 07:40 UTC. Prices briefly dropped below $111,000 before stabilizing around $112,800, based on CoinDesk data.
According to blockchain analytics firm Timechainindex.com, a single entity initiated the flash crash by offloading its entire 24,000 BTC balance—worth over $300 million—through a transfer to crypto exchange Hyperunite. “They moved 12,000 BTC today and continue to sell, contributing to the ongoing pressure,” researcher Sani posted on X. The whale reportedly still controls 152,874 BTC across linked wallets.
The coins originated from HTX roughly six years ago and had remained untouched until this recent activity.
Post-Powell Optimism Reversed
Friday’s gains had been driven by Powell’s Jackson Hole speech, in which he appeared to support the case for interest rate cuts and downplayed the inflationary impact of Trump-era tariffs. BTC surged nearly 4% from $112,500 to $116,900 in response, mirroring a broader risk-on rally in U.S. equities and a dip in the dollar index.
Market participants interpreted the remarks as a potential green light for monetary easing in September, stoking optimism for new all-time highs in bitcoin and ether. However, the weekend crash underscored the fragility of those gains in the face of large-scale selling.
Options Market Still Reflecting Fear
Despite the dovish policy shift, bitcoin options traders remain cautious. Data from Amberdata shows Deribit’s 25-delta risk reversals—used to gauge market sentiment—are still negative through December expiry. This indicates put options (which protect against downside moves) are more expensive than calls, a sign that traders continue to hedge against near-term volatility.
In short, while Powell’s comments may have boosted sentiment in traditional markets, crypto traders are still bracing for turbulence ahead.
