Mt. Gox, German government and the FED add downward pressure – DiarioBitcoin
By Hannah Perez
Bitcoin hit its lowest price since February as payments to Mt. Gox victims are activated and the German government continues to sell bitcoins. Economic uncertainty in the US also contributed to volatility.
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- Bitcoin slipped below $58,000 for the first time since February
- Events like Mt. Gox payments and German government Bitcoin sales add downward pressure
- Economic uncertainty and the delayed rate cut in the US also contribute to volatility
Bitcoin (BTC) continues to extend weekly losses, hitting its lowest price in nearly five months.
The top cryptocurrency by market cap slipped below the $58,000 mark on Thursday amid a 4% daily drop and more than 5% on the week. Bitcoin hit a price as low as USD $57,043 in the morning hours (EDT), a level last seen in late February, according to data from CoinMarketCap.
The rest of the market followed suit with some major cryptocurrencies seeing even larger daily losses in percentage terms. Binance Coin (BNB), Solana (SOL), XRP, Toncoin (TON) and Dogecoin (DOGE) They all fell by around 6% while the global capitalization of digital currencies fell by 4% to USD $2.13 trillion.
The widespread price slide triggered a sharp wave of liquidations on centralized cryptocurrency exchanges amounting to nearly $300 million, according to data from Coinglass of the last 24 hours.
More than 100,000 cryptocurrency traders were liquidated, with the largest volume of liquidations coming from leveraged long positions, i.e. bets on higher prices.
Mt. Gox payments, German government sales and US economic uncertainty
The bearish price action in the digital asset market coincided with a series of events that have sparked widespread bearish sentiment among traders. The long-awaited payouts from the defunct cryptocurrency exchange Mt. Goxthe continued whale movements of the German government and the economic uncertainty in the US are some factors.
Creditors are expected to Mt. Goxwhich collapsed 10 years ago, receive around 142,000 BTC, worth approximately USD $9 billion, starting in July, which will inject massive liquidity into the market.
Payments of Mt. Gox will add “substantial selling pressure” to the marketas it absorbs the additional supply of Bitcoinhe explained Rachael Lucas, Crypto Analyst at the Exchange BTC Markets from Australia, as cited The Block.
On the other hand, there are the continuous movements of bitcoins that the German government has been carrying out for the past few weeks. Wallets associated with the German government have moved an estimated more than USD $800 million in Bitcoin to exchange platforms, suggesting possible massive sales of the cryptocurrency. This Thursday, the authorities of that European country made another series of deposits for 1,300 BTC to the exchanges Coinbase, Bitstamp and Kraken.
There is also uncertainty surrounding inflation in the US and the upcoming interest rate cut by the Federal Reserve (FED). Fed Chairman Jerome Powell spoke out on the issue earlier this week, saying more work is needed to tame inflation. The central bank estimates only one cut for this year.
“The drop below the USD $60,000 resistance line is significant as it marks a psychological barrier for many investors.“Lucas said, taking these factors into account and anticipating greater volatility in the short term.
“In the next week, I expect bitcoin to continue to experience volatility as the market digests the Mt. Gox payments and responds to broader economic signals.”the analyst added. “If market liquidity remains strong, we could see a bitcoin bounce as it has done in the past after significant sell-offs..”
Article by Hannah Estefanía Pérez / Bitcoin Diary
Picture of Unsplash
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