Bitcoin has dropped to as low as $58,000 in the last 24 hours, having failed to once again hold above the crucial support at $60,000. Different analysts have suggested that the CME gap caused this price decline and that BTC could enjoy a relief bounce going forward. 

The CME Gap Caused Bitcoin To Decline Below $60,000

Crypto analyst Daan Crypto hinted in an X (formerly Twitter) post that Bitcoin experienced this recent price decline to close the CME gap around the $60,000 range. The CME gap is the difference between BTC’s price on the Chicago Mercantile Exchange (CME) futures market between when the market closed on Friday and reopened on Monday. 

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While sharing a chart of Bitcoin CME futures, crypto analyst Speed Racer also alluded to the CME gap as responsible for Bitcoin’s recent decline. He stated that the market makers were running the BTC market in the short term as there was no way they would leave a “$1650 CME gap from the weekend.” 

Crypto analyst Ninja also explained that the recent price decline was caused by the CME gap and even tagged it as “bullish selling.” He assured that everything would be okay, with a market rebound likely on the cards. Ninja also urged market Bitcoin bulls not to panic, although he subtly admitted that the current market conditions are enough to make anyone panic. 

Fortunately, the worst looks to be over, as Daan Crypto revealed that the CME gap has been fully closed. This suggests that Bitcoin should enjoy a relief bounce from its current price level. Crypto expert Michael van de Poppe also confirmed that the CME gap has closed and predicted that it’s time for BTC to bounce up. 

Crypto analyst Titan of Crypto shared a similar sentiment while revealing that the CME gap has been filled. He claimed that nothing was holding Bitcoin back now and that it was time for the flagship crypto to send. From the chart the analyst shared, BTC could rise to $72,000 on its next leg up. 

The CME Gap Might Not Be The Only Problem

Selling pressure on Bitcoin is another problem that is responsible for its price decline. Data from Farside Investors shows that the Spot Bitcoin ETFs are still witnessing huge net outflows, with fund issuers having to offload their BTC holdings to fulfil redemptions. 

There is also significant selling pressure from the German government, which still appears to be selling its Bitcoin holdings based on data from Arkham Intelligence. This is in addition to concerns about the selling pressure that BTC could witness once the defunct crypto exchange Mt. Gox begins to repay its creditors about $9 billion worth of crypto. 

At the time of writing, Bitcoin is trading at around $58,600, down over 3% in the last 24 hours, according to data from CoinMarketCap. 

Featured image created with Dall.E, chart from Tradingview.com

Crypto mogul Justin Sun has expressed his intention to buy a massive trove of Bitcoin, valued at approximately $2.3 billion. Sun made this bold claim as the crypto markets witnessed significant panic, particularly from the German government’s recent extensive Bitcoin transactions.

Governments seize illicit crypto during various operations. Then they periodically auction off these digital assets, thereby introducing selling pressure into the market.

German Government Moves $174.3 Million Worth of Bitcoin

Over the past few weeks, the German government has been actively moving its crypto assets. It has transferred large amounts of Bitcoin to various wallets and exchanges.

Recent blockchain data analysis by Arkham shows that just today, the German crypto wallet moved 3,000 Bitcoin (BTC) worth roughly $174.3 million. The government distributed this BTC to several destinations, including major crypto exchanges like Bitstamp, Kraken, and Coinbase.

Read more: Who Owns the Most Bitcoin in 2024?

These movements are part of a broader trend that started on June 19, with the government shifting about 6,500 BTC, pushing the total value transferred to exceed $425.49 million. The origins of these assets are likely tied to criminal enterprises. Arkham suggested a connection to the defunct pirated movie site, Movie2k.

The recent transactions have noticeably impacted the crypto market, creating waves of concern among investors and traders. Indeed, the sensitivity of the market to such large-scale disposals became evident today as Bitcoin reached the $57,000 mark for the first time in two months. This surge was further fueled by an incident involving a crypto whale who sold $400 million worth of Bitcoin.

Amidst this volatility, Justin Sun has proposed to purchase the entire cache of Bitcoin currently held by the German government, amounting to 40,359 BTC.

“I am willing to negotiate with the German government to purchase all BTC off-market in order to minimize the impact on the market,” Justin Sun posted to his 3.5 million followers.

Read more: How To Make Money With Intel-To-Earn on Arkham Intelligence

Sun’s strategy could potentially stabilize the market by preventing a large-scale sell-off on public exchanges, which might otherwise precipitate a sharp decline in Bitcoin prices. More than direct price impact, this move can ease the panic amongst crypto investors.

Spot Bitcoin ETF approval in January marked a shift in the crypto industry. Investment bank Architect Partners lauds the product for significantly driving capital inflows in the first half of 2024.

The financial instrument gave institutional players a seat at the table when it delivered BTC to Wall Street. More exposure is expected as Ethereum (ETH) and Solana (SOL) ETFs align. 

BTC ETFs Among Catalysts for $750 Billion Crypto Surge

Architect Partners’ financial report indicates that Bitcoin Spot ETFs have attracted more than $15 billion to the cryptocurrency market since their launch on January 11. This, combined with more than $700 billion in value growth among crypto tokens and over $11 billion in growth among publicly listed cryptocurrency companies, brings total H1 growth to at least $750 billion year-to-date.

The approval of BTC spot ETFs jump-started the industry after the previous bear market instigated by Terra’s collapse and FTX’s implosion in 2022. According to insights by Architect, crypto’s recovery outpaces that of the internet from its crash in 2000.

Read more: What Is a Bitcoin ETF? All You Need to Know

According to the report, this growth signifies a comeback for the industry, with market confidence and momentum increasing.

“The significant influence of BTC Spot ETFs on the digital assets market is evident from the distribution of trading volume throughout the week. From January to June 2024, weekend trading volume accounted for only 16% of the total, the lowest ever recorded for this period (H1 of a year). This indicates increased activity from traditional finance investors, with trading volume concentrated during Monday to Friday. It is particularly strong during US market hours, decreasing after the US market closes,” Matteo Greco, Research Analyst at Fineqia, told BeInCrypto.

Architect Partners’ report also acknowledged increasing “professionalism, risk management, and ethical behavior.” It highlights the spirit of ‘doing it right’ in the industry, adding that these are the foundational principles of crypto.

Analyst Decries Stagnating BTC ETF Flows

Despite the significant contribution to the industry, BTC ETFs’ capital flows have stagnated lately.

“US Bitcoin ETF flows have mostly stagnated. Not seeing tons of inflows, not seeing tons of outflows. Net inflows since launch sits at very healthy $14.7 billion,” wrote Bloomberg ETF analyst James Seyffart.

Seyffart also noted a drop in BTC ETF trading volumes, highlighting that this metric has not hit $3 billion since mid-May. Fineqia’s analyst, Greco, told BeInCrypto that traditional finance investors concentrate their trading volumes between Monday and Friday, focusing on US market hours.

According to data from investment management company Farside Investors, BTC ETFs experienced total net outflows of $13.7 million on Tuesday. This marked a break from five consecutive trading days of positive flows. Grayscale recorded up to $32.4 million in outflows, effectively topping the day’s negative flows.

Read more: How To Trade a Bitcoin ETF: A Step-by-Step Approach.

The instrumental role of Bitcoin spot EFTs in driving capital into the crypto industry cannot be overlooked. As they account for 2% of the growth in six months, it becomes imaginable how much more could be achieved with more such financial instruments in the market.

Meanwhile, the market awaits a possible Ethereum (ETH) spot ETF launch within the month. The countdown is also on for a prospective Solana (SOL) ETF following VanEck’s move to pioneer the application in the US.