Bitcoin’s price dipped below the crucial $60,000 mark on July 3, potentially extending its ongoing consolidation phase, as Mt. Gox prepares to release approximately $9 billion worth of BTC.
The world’s first cryptocurrency, Bitcoin (BTC), dropped by 4.2% in the 24 hours leading up to 10:33 am UTC on July 3, hitting a low of $59,600. According to CoinMarketCap, it has also seen a 1.8% decline over the past week.
BTC/USD, 1-day chart. Source: CoinMarketCap
Since June, Bitcoin has been on a downward trajectory, marking an 18% decrease during the second quarter of 2024. Investors had hoped for a breakout above the $70,000 mark to propel it to new all-time highs. However, losing the critical support at $60,000 could lead to a more prolonged correction.
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How long will Bitcoin’s price consolidation last?
Did Mt. Gox start repaying creditors?
Bitcoin’s drop below $60,000 is likely linked to the anticipated commencement of Mt. Gox’s creditor repayments, scheduled for early July. The defunct exchange appears to have initiated repayments, as indicated by a chart showing Bitcoin transfer volumes involving tokens dormant for seven to ten years, shared by Charles Edwards, founder of Capriole Investments.
Bitcoin: spent volume. Source: Charles Edwards
Over $9.4 billion worth of Bitcoin is owed to about 127,000 Mt. Gox creditors who have awaited reimbursement for more than a decade. Many investors may choose to cash out now that these long-frozen funds are beginning to move.
However, the influx of $9 billion from Mt. Gox could be offset by institutional inflows into US-based spot Bitcoin exchange-traded funds (ETFs), which have accumulated more than $52.5 billion worth of BTC since their January launch, according to Dune.
Bitcoin ETFs, net flows. Source: Dune
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4-week correction for Bitcoin? Mt. Gox, Germany gov’t add sell-pressure
Did Bitcoin whales cause Bitcoin to fall below $60,000?
The drop below $60,000 may also have been influenced by a large Bitcoin holder, or “whale,” who reportedly sold $180 million worth of Bitcoin in just three minutes—an unusually high amount to dump at market value within such a short span. This substantial sale was identified by industry observer Zaheer in a July 3 report.
BTC/USD, price and aggregated funding chart. Source: Zaheer
Further contributing to the price decline, another unidentified whale transferred 1,723 BTC valued at over $168 million to Binance in the past 24 hours, according to Lookonchain.
BTC whale transfers to Binance. Source: Lookonchain
This move to the largest crypto exchange suggests that this entity aims to capitalize on profits by selling its holdings.
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