One of the reasons behind the Bitcoin drop today, which amounted to a 5% slump, is a slew of selloffs from the U.S. government, the German government and other whales.
Bitcoin (BTC) is currently witnessing one of its most bearish periods this year, having collapsed nearly 21% from the June 7 peak of $72,144. BTC’s downtrend has persisted for four weeks, with multiple support levels breached.
Bitcoin Suffers Additional 5% Slump Today
The premier cryptocurrency displayed commendable resilience against this downturn on June 25 after retesting $58,000. This resulted in a 6-day consolidation period. The consolidation ended with an uptick from June 29 to July 1. With July expected to restore the bullish momentum, investor sentiment saw a favorable shift.
However, despite this shift, some market watchers warned of a resumption of hostilities. Dr. Martin Hiesboeck, Head of Research at Uphold, is one such commentator. As The Crypto Basic reported yesterday, Hiesboeck informed the investing public of a Bitcoin double top on the weekly chart. This is a pattern that signals sustained dips.
Interestingly, this projected downtrend has now materialized, with Bitcoin having dropped by an additional 5% today. The crypto token has now relinquished the $59,000 and $58,000 price thresholds to bearish action, currently trading for $57,426. This renewed slump is a product of multiple selloffs by several whales.
Reason Behind the BTC Drop: Whale Selloffs
On-chain analytics platform Spot On Chain (SOC) called attention to four of these large selloff events. In their report, they identified the movement of 3,500 BTC ($206 million) to Binance. The whale involved, though unknown, is likely depositing them in an attempt to dump. The address still holds 4,368 BTC at a loss.
🔻The #Bitcoin price plummeted by 5% today. What happened?
A summary of massive sells-off today:
1️⃣ Whale 3G98j moved 3,500 $BTC ($206M) to Binance.
– still holds 4,368 $BTC ($256M) and these $BTC were/are at losses.2️⃣ The German Government transferred out 3,000 $BTC, of… pic.twitter.com/bN0xibfUQ4
— Spot On Chain (@spotonchain) July 4, 2024
Besides this whale, another unidentified address sent 1,023 Bitcoin valued at $62.2 million to Binance today. Notably, this has compounded selling pressure, leading to investor angst and bolstering the ongoing downtrend.
Moreover, the German government has also taken the spotlight. The criminal police office, BKA, recently moved 3,000 BTC, sending 1,300 of these tokens to exchanges for selloffs. These tokens are part of the 50,000 BTC seized by the government in 2013 from defunct piracy platform Movie2k. The BKA still holds 40,359 BTC.
Also, the American government transferred 237 Bitcoin worth $13.67 million to a new wallet today. Some entities create such fresh wallets with intentions of dumping their holdings. SOC confirmed that the U.S. government still has a balance of 213K BTC confiscated in multiple enforcement actions.
Mt. Gox Readies for Repayment
In addition to the selloff campaign spotlighted by SOC, blockchain reporter Colin Wu highlighted movements by bankrupt exchange Mt Gox today.
Mt. Gox conducted several small transfer tests at 12:21 UTC+8 today, including 0.0001 BTC transferred to Bitbank hot wallet; 0.0001862 BTC transferred to unmarked address: 1JdFfR…qg849e; 0.0001 BTC transferred to unmarked address: bc1qkj…2ug68h. https://t.co/SxMSSYkMRU
— Wu Blockchain (@WuBlockchain) July 4, 2024
Notably, the exchange carried out several BTC test transactions in the build up to their compensation plan. Recall that Mt. Gox confirmed plans to begin repayment to creditors in early July, with 141.687K BTC ($8.1 billion) as balance. The development comes after the exchange moved 140K BTC to the current wallet in May in preparation for the repayment.
Meanwhile, The Crypto Basic reported today that a dormant Bitcoin whale awoke after 12 years to move out 119 BTC. These movements have contributed to investor angst, leading to further selloffs and triggering the declines today. CryptoQuant confirmed that new investors have been selling off their holdings, having recently dumped $2.4 billion.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic’s opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
-Advertisement-
