(Kitco News) The crypto market is holding this week’s impressive gains despite the news of $600 million getting stolen in one of the major crypto heists to date. Analysts point to whale activity in the crypto space as the reason behind the move higher.
Crypto whales are entities or individuals who hold very large amounts of a particular coin. There is no particular threshold to be a whale, but some have used 1,000 BTC as the mark.
The crypto space should have been shaken by the news that hackers were able to steal around $600 million worth of crypto from a blockchain project connected to the popular Axie Infinity online game.
Blockchain project Ronin reported Tuesday that on March 23, hackers got away with 173,600 Ether tokens and 25.5 million USD Coin tokens. This makes it one of the biggest crypto attacks to date. “The attacker used hacked private keys in order to forge fake withdrawals,” Ronin Network said in a blog post.
Yet security concerns around crypto have had minimal impact on prices, especially after this week’s impressive rally.
Bitcoin rose more than 11% during the past seven days, and Ethereum, the world’s second-largest cryptocurrency, jumped more than 14%. Other coins, including Solana, Cardano, and Terra surged 37%, 23% and 17%, respectively.
For Bitcoin, this rally meant seeing all of its year-to-date losses get erased. At the time of writing, Bitcoin was trading at $47,226.85, and Ethereum was at $3,393.16, holding all their weekly gains. The overall crypto market cap was also well above $2 trillion.
A major driver behind the move was influential whale activity. One of the most recent headlines was Michael Saylor’s MicroStrategy setting up a $205 million loan to buy more Bitcoin. The loan will come from Silvergate Bank and will be collateralized by Bitcoin.
“Michael Saylor?? (@saylor) March 29, 2022
“The SEN Leverage loan gives us an opportunity to further our position as the leading public company investor in bitcoin,” said MicroStrategy CEO Michael Saylor. “Using the capital from the loan, we’ve effectively turned our bitcoin into productive collateral, which allows us to further execute against our business strategy.”
MicroStrategy now owns around 125,000 Bitcoin tokens.
Earlier this week, Bloomberg also reported a significant Bitcoin purchase from the Luna Foundation Guard, which was planning to back its token with more than $10 billion in Bitcoin reserves.
P2P electronic cash that is easier to spend and more attractive to hold #btc
“Do Kwon?? (@stablekwon) March 14, 2022
“Bitcoin remains above $47,000, showing great strength amongst the news of the hack,” said GlobalBlock analyst Marcus Sotiriou. “One factor for this could be the positive news of Michael Saylor, CEO of MicroStrategy, obtaining a $205 million loan from Silvergate Bank, which is collateralised by Bitcoin, in order to buy more Bitcoin. The buy pressure of MicroStrategy and Luna Foundation Guard is understandably contributing to a strong uptrend in the short term.”
Renewed interest in Bitcoin is also confirmed by the Coinshares report, which cited the largest inflows to crypto funds since December. “After two straight weeks of outflows, there were $193 million in inflows last week, with $147 million in inflows for European funds and $45 million in inflows for American funds,” Sotiriou noted.
Bitcoin is becoming the world’s digital collateral, and prices are likely to break $60,000, Bloomberg Intelligence said Wednesday.
“Bitcoin’s declining supply schedule is unprecedented vs. most assets, which are subject to supply elasticity. By code, there will never be more than 21 million Bitcoins and about 90% are already mined,” said Bloomberg Intelligence senior commodity strategist Mike McGlone. “Short holders seeking to cover or new long positions expecting $30,000 may be disappointed, and $60,000 resistance appears less enduring than in November.”
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