Bitcoin (BTC) hit a six-month high of $24,800 on Feb. 16, registering a double-digit surge of 15%.
The single-day Bitcoin price surge took many by surprise, given February has been historically bearish for the top cryptocurrency. BTC’s price rose by $1,820 in a single day, making it the biggest green day for the top cryptocurrency in six months.
One-day Bitcoin price chart. Source: TradingView
Many people attributed the BTC price surge to several factors, including a rise in dollar value and declining inflation. On-chain data indicates the current price momentum can be traced back to a mysterious fund that started pouring money into the crypto market on Feb. 10.
According to data from Lookonchain, nearly $1.6 billion in institutional funds have flowed into the crypto market over the past six days. Most of the $1.6 billion flowed from stablecoins, especially Circle-issued USD Coin (USDC). The owner of the funds first withdrew their USDC from Circle and then sent it to various exchanges.
USDC withdrawal from Circle. Source: Lookonchain
There were three notable wallets whose funds were traced from Circle to various exchanges. First, a wallet address starting with “0x308F” withdrew 155 million USDC from Circle and transferred to exchanges since Feb. 10. The second wallet address starting with “0xad6e” withdrew 397 million USDC from Circle and sent it to various exchanges, and a third wallet starting with “0x3356” withdrew 953.6 million USDC from Circle and transferred to exchanges around the same time.
Wallets moving funds from Circle to exchanges. Source: Lookonchain
The Bitcoin price surge comes just days after the top cryptocurrency hit its first-ever weekly death cross. The death cross appears on a chart when an asset’s short-term moving average, usually the 50-day, crosses below its long-term moving average, usually the 200-day. Despite the bearish nature of the pattern, the death cross has been followed by above-average short-term returns in recent years.
The crypto community reacted differently, with Bitcoin proponents calling it the start of another bull run. Samson Mow commented on the price surge, “BTC price is still below the 200 WMA, which is 25k. Bitcoin trading below the 200 WMA is an anomaly.” In each of its major market cycles, Bitcoin’s price historically bottoms out around the 200-week moving average. Others called the recent price surge a bear trap while warning that large players are cashing out.