Bitcoin Drops Below $83,000 as US Government Transfers Over 10,000 BTC, Sparking Panic Over Potential Selling Pressure

TradingKey - US government transfers over 10,000 BTC as Bitcoin extends losses to breach $83,000, but a further sharp decline remains unlikely.

On October 8, Bitcoin (BTC) extended its recent losses, falling for four consecutive trading days and dropping below the $83,000 mark. Over the past 24 hours, the price of Bitcoin fell about 1.5%, hovering around $82,811.

Recent massive cryptocurrency transfers from US government addresses have once again served as a catalyst for market sentiment, triggering long liquidations and market panic. According to Arkham on-chain data, wallets associated with the US government transferred over 11,000 Bitcoins into Coinbase Prime over the past two days.

Over the past 24 hours, the Crypto Fear & Greed Index fell to 59, hitting a new low for nearly two months and gradually shifting from greed to neutral. Meanwhile, over 90,000 traders were liquidated across the network, with total liquidations reaching $411 million, of which long positions accounted for $356 million, or 86%.

Transfers from government wallets to exchange custody accounts or test addresses typically involve several possibilities: preparation for public auctions, transfers between custodians, or preparation for restitution to victimized institutions or individuals. Although the market initially interprets transfers to exchanges as potential selling pressure, historical experience shows that the disposition of government-confiscated assets usually follows strict judicial procedures and may not immediately result in market dumping, though the market has already begun reacting.

Bitcoin's fall below $83,000 was not triggered solely by on-chain transfers, but rather by the combined impact of macroeconomic risk aversion and market-wide high-leverage liquidations. Rising US Treasury yields, a strengthening US Dollar Index breaking above 102, and geopolitical tensions have led global capital to withdraw from high-risk assets, putting pressure on the crypto market as a whole. Over the past half month, Bitcoin's multiple attempts to push toward $87,000 have all failed.

Bitcoin price chart, source: TradingView

From a technical analysis perspective, Bitcoin's defensive line lies at $82,000, a key support level converted from previous strong resistance. It retested this level once in late September without breaking below, indicating that bulls still intend to defend this position. In addition, US September non-farm payroll data fell significantly below expectations, sharply boosting market expectations for the Federal Reserve to hold rates steady at its October 27–28 meeting. Under these circumstances, Bitcoin is more likely to remain fluctuating within the $82,000–$87,000 range.