The price of bitcoin falls below USD 64,000. What is happening?

Bitcoin exchange-traded funds (ETFs) in the United States recorded outflows in the last week, exerting downward pressure and taking the price of the digital currency below the $64,000 barrier.

According to SosoValue data, this Thursday there were net outflows in ETFs of $139 million. In this way, these financial instruments lost more than 900 million dollars so far this week.

The Grayscale ETF (GBTC) saw net outflows of $53 million, while the Fidelity instrument (FBTC) saw a total of $51 million. The only net receipts were one million dollars and came from BlackRock’s iShares Bitcoin Trust (IBTC).

As a result of this wave of sales that was recorded this week, BTC price fell 5%, as seen in the following graph. At the time of publishing this note, its price is $63,655.

As CriptoNoticias already reported, this is not the only factor that is exerting downward pressure on the price of BTC. Added to this situation is the behavior of the “weaker” miners and the developments in the case whose main defendant is the businessman and founder of Terraform Labs, Do Kwon.

In this framework, the Colombian analyst Juan Rodríguez explained that the miners after the halving, in April 2024, They went on to earn 900 BTC to 450 BTC daily for carrying out their activities within the network. “If the price of bitcoin does not rise, they have economic problems and they will have to sell more of these 450 BTC that they receive per day to pay for electricity, maintenance and their operating expenses,” he commented.

According to his analysis, the miners’ profits began to fall since March and, from that moment, they receive the same profits in dollars as in the second half of 2023. Rodríguez detailed:

“There are many more miners than there were in 2023, what is happening is that there is a capitulation of miners: they sell more BTC than they produce and that causes additional downward pressure. This capitulation also occurred at the last halving in 2020.”

Juan Rodríguez, cryptocurrency market analyst.

How does Do Kwon’s agreement with the SEC affect the price of BTC?

Terraform Labs and Do Kwon agreed pay a fine of 4.47 billion dollars to the US Securities and Exchange Commission (SEC). It was approved on June 13, by a judge of the United States district court.

It is important to remember that the institution was behind the launch of the successful LUNA token and the dollar-anchored stablecoin TerraUSD (UST), assets that in 2022 starred in a tragic collapse that pushed the market into a downward trend.

This fact was not lost on the Colombian analyst Rodríguez, who indicated that this fine is the equivalent of a sum greater than 65,000 BTC. “Terra Foundation in 2022 created a currency that went up to 120 dollars and from there it went to 0. With the money they raised they bought 80,000 BTC and other cryptocurrencies. At that time, that guy told us that they sent those BTC to the exchanges and to pay the fine they were going to sell part of those 60,000 bitcoins,” he noted.

There are still bullish projections for the price of bitcoin

BTC spot exchange-traded funds in the United States are coming off a string of negative days. However, it is important to highlight that these instruments have been widely adopted since their market launch in January 2024.

As Criptonoticias already reported, ETFs have recorded inflows of more than $14 billion and they had a positive streak of 19 days of money flows.

The inclusion of these instruments in the market facilitates the institutional and corporate adoption of the digital currency created by Satoshi Nakamoto. If the income of money to these funds resumes, a favorable scenario could be generated for the BTC price. What happens is that the companies issuing the ETFs must buy and hold bitcoin to back their actions.

The growing demand, added to the scarcity of BTC, could generate a upward pressure on its price in the long term.

Last, but not least, is that data on the United States economy continues to show signs of recovery. In May, 272,000 jobs were created despite persistent inflation and high interest rates set by the Federal Reserve of that country (FED).

Additionally, the average hourly wage increased 14 cents to $34.91, bringing the annual increase to 4.1%. That is, it exceeded the inflation rates, which were 3.3% year-on-year in May.

With greater purchasing power, People will have more money available to invest in risk assets and bitcoin.