Last week, the price of Bitcoin rebounded from dips below the psychological level of $20,000, but today we are seeing further weakening. The capitalization of the entire cryptocurrency market is again approaching levels around $900 billion. Buyers have so far decided not to take more risks and have not pushed the price of Bitcoin above $22,500:
- The price of Bitcoin and Ethereum seems to be forming a formation resembling a double top ($22,500 and $1,280) which may favor the supply side and push the bulls back to defense;
- Investors are concerned about the potential impact of nearly 137,000 BTC on the market due to the repayment of creditors of MtGox, the largest cryptocurrency exchange hacked in 2014, from which 850,000 BTC was stolen at the time. Market rumors point to August as potentially the first date for repayment of creditors;
- The impact of more than 130,00 BTC on the exchanges (should the creditors decide to sell the tokens) could cause a sudden drop in Bitcoin's price, potentially also supported by declining trading volume on the exchanges. At the same time, creditors may decide to receive the US dollar equivalent of their previously blocked Bitcoin, which is likely to be decided by a portion of them willing to abandon their involvement in the recently losing crypto market.
- Some of the Ethereum-positive investors believe that the drop in Bitcoin triggered by MtGox creditors could help the transitioning to Proof of Stake Ethereum, which could then potentially begin the flippening predicted by some in the market, i.e. overtake the capitalization of the 'king of cryptocurrencies' itself.
- Recently, there has been a dramatic increase in the activity of the Ethereum Name Service (ENS, decentralized domain name protocol) network, the model of which is confusingly similar to the redemption of Internet domains. On the network, using NFT (OpenSea) technology, buyers are buying up three-letter 'domains' in Ethereum en masse, hoping to sell them at a profit in the future. Trading is supported by record low fees on the Ethereum network due to declining trading volume and declining volume of transactions on the network.
- Ethereum has been unable to sustain gains despite a successful merge on the Sepolia test network, last week. The ETH community is worried about further delays of the difficulty bomb, originally the transition to version 2.0 was supposed to happen in August, now September seems to be the closest date, which was also confirmed by creator Vitalik Buterin.
- Competition for Ethereum is growing from the recently gaining popularity Bitgert token, which is capable of processing 100,000 transactions per second with almost zero transaction fees on the network.
- Increased shark activity (addresses holding between 10,000 and 100,000 tokens) has increased since June 9, and by today they have managed to accumulate Cardano worth nearly $37 million according to Santiment data. The data also confirms that Cardano whales have almost completely stopped selling, which may support the token's price and confirms a strong sell-off. Altcoins, however, still remain sensitive to Bitcoin price movements, so it may still be too early to forecast a bottom.
- According to Ruchir Sharma, managing director and president of Rockefeller International, temporary declines in cryptocurrencies will not prevent them from a future bullish rally. Sharma cited as an example the situation with Amazon's stock, which has experienced similar volatility in the past but did not prevent the company from climbing to the top of Wall Street.
- Starting this week with the banking sector (July 15, Citigroup results), Wall Street's earnings season for the second quarter of the year could help cryptocurrencies lift if companies' results show readings above analysts' expectations. On the other hand, it could also initiate a larger decline if the results turn out to be weak. However, it is worth noting that the situation in the US stock market also has a political dimension in the context of the upcoming mid-terms elections.(According to data from April, almost 58% of Americans say they are involved in the stock market). Analysts' forecasts may be slightly understated to help financial markets make up for massive losses.
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Create account Try a demo Download mobile app Download mobile appBitcoin has had a disastrous month, June was the worst for the 'king of cryptocurrencies' since 2011 when the price fell below $10 per BTC at the time, illustrating just how dire the sentiment is. The specter of recession and monetary tightening continue to make investors shy away from risky assets, and their sense of security is declining, indicating further hoarding. The Bitcoin market appears to be heavily oversold which has historically indicated an opportunity for long-term investors. Source: Glassnode
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