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Bitcoin Risk Of Sell-Off Drops Sharply As Short-Term Holder Profit Remains Low

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Over the weekend, Bitcoin suffered from mounting sell pressure that pushed the price below $70,000 once again. However, with the short-term hold profitability remaining low at this time, the risk of the pioneer cryptocurrency suffering further sell-offs has dropped significantly.

Bitcoin Short-Term Holder Profitability At 3.35%

Crypto analyst Ali Martinez has soothed Bitcoin investors’ nerves with new data that shows a reduced risk of sell-off. The chart which was posted in the early hours of Monday shows that Bitcoin short-term holder profitability has remained low going into the new week.

According to Martinez, the low profitability, which is currently sitting at just 3.35%, means that there is a minimal risk of sell-off at this time. This is because short-term investors are likely to wait for higher profit margins before they start selling off their holdings for profit.

The chart shows that in the last few weeks, the Bitcoin short-term holder profitability has fluctuated wildly, as the Bitcoin price has struggled to find its footing. However, looking at the profitability over a longer period of time, and it seems that short-term holders have done quite well for themselves.

Compared to where the short-term holder profitability was at the start of the month of June, these investors are seeing positive upside as of recently. However, compared to previous sell trends, the profitability will have to increase for these short-term investors to begin selling once again.

Can BTC Surge From Here?

In a previous analysis of the Bitcoin price, crypto analyst Ali Martinez has mapped out where he expects the BTC price to go from here. The analysis showed the cryptocurrency’s movements over the last year with various corrections and peaks.

Going by this data, the crypto analyst believes that the next local top for the Bitcoin price could lie around the $89,200 level. From the current price of around $69,400, this would be a 28% increase in price, and a new all-time high for the digital asset.

Additionally, another post by the analyst shows that the Taker Buy Sell Ratio on the HTX Global Exchange rose as high as 730. What this means is that there is a lot of bullish sentiment toward the cryptocurrency and the analyst believes that this could drive the next rally.

For now, the Bitcoin price continues to struggle amid mounting pressure from bears. After reaching $71,000 last week, the price has since retraced most of its gains. Currently trading at $69,429 at the time of writing, it has seen a 0.45% increase in the last week. However, it remains the largest cryptocurrency with a market cap of $1.368 trillion.

Bitcoin price chart from Tradingview.com
BTC price fails to reclaim $70,000 | Source: BTCUSD on Tradingview.com

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





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What $2.2 Billion Means for Market

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Defunct crypto exchange Mt. Gox, once the most significant player in Bitcoin trading, moved $2.2 billion worth of Bitcoin on Monday. The transaction marked one of its largest transactions since its infamous 2014 collapse.

Blockchain analytics firm Arkham Intelligence identified the movement of 32,371 BTC, a transaction that has sent waves through the crypto market.

Mt. Gox Moves 32,371 Bitcoin

Arkham Intelligence’s analysis revealed that a prominent wallet address labeled “1FG2C…Rveoy,” moved 30,371 BTC, while an additional 2,000 BTC initially went to a Mt. Gox cold wallet before being moved to a different, unmarked address.

Spotonchain confirms the report, indicating that over the last four days, Mt. Gox has moved Bitcoin worth $2.22 billion. Among these tokens, 296 BTC valued at $20.13 million was moved to B2C2 and OKX. Such significant transfers are noteworthy because they often signal preparations for creditor distributions.

Read more: Top Crypto Bankruptcies: What You Need To Know

Mt. Gox BTC Transfers
Mt. Gox BTC Transfers. Source: Arkham Intelligence

As BeInCrypto reported, Mt. Gox has already funneled smaller amounts to creditors using exchanges like Bitstamp and Kraken. The exchanges helped facilitate smooth transfers for those affected by the exchange’s collapse a decade ago. Meanwhile, analysts predict continued volatility, especially as the US election cycle adds a layer of uncertainty to global markets.

“The recent $2.2 billion Bitcoin movement and extended repayment timeline from Mt. Gox will likely inject some volatility into the market in the short term. With such a large amount of Bitcoin potentially entering circulation, there’s bound to be short-term price swings as recipients decide whether to hold or sell,” Peter Watson, Chief Market Officer at Velar, told BeInCrypto.  

Indeed, following the transfer, Bitcoin prices momentarily dipped below $68,000 during Asian market trading, briefly rattling investor confidence. However, the asset quickly rebounded to trade for $68,810 as of writing.

BTC Price Performance
BTC Price Performance. Source: BeInCrypto

However, Watson says the impact may be less severe than some fear, especially as many creditors have had years to consider their strategies. Further, he observes that this could benefit market confidence.

“For many, seeing the Mt. Gox saga finally come to a close may reinforce the belief that Bitcoin is better equipped for sustained growth and stability.. ultimately strengthening confidence in its future,”  Watson added.

An Ongoing Saga of Repayment and Recovery

The transfer occurred just a week after Mt. Gox extended its repayment deadline for creditors by another year, much to their frustration. The decision was partly due to the logistical and technical hurdles of coordinating payments to thousands of creditors.

“Many rehabilitation creditors still have not received their repayments because they have not completed the necessary procedures for receiving repayments. Additionally, a considerable number of rehabilitation creditors have not received their repayments due to various reasons, such as issues arising during the repayments process,” Mt. Gox explained.

This process has been an agonizing journey for creditors, filled with delays, legal complications, and financial uncertainty. The repayment saga continues, fueling concerns over market volatility. However, analysts suggest that the postponement could be delaying a potential sell-off.

“$4 billion payment selling pressure now shifted to 2025,” one user shared on X.

Read more: Who Owns the Most Bitcoin in 2024?

According to data on Arkham, Mt. Gox still holds 44,378 BTC, which is valued at approximately $3.05 billion. As the market continues to advance, events like Mt. Gox’s transfers serve as reminders of the industry’s turbulent past. For creditors, however, the wait remains, extending a wait that has already spanned nearly a decade.

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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US Elections Push Crypto Investment Inflows to $2.17 Billion

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Crypto investment inflows surged to $2.17 billion last week, reaching an unprecedented $29.2 billion in year-to-date inflows. This influx elevated the total assets under management (AUM) in digital assets to over $100 billion, a level previously reached only in June 2024.

The rise comes amid renewed interest in Bitcoin, which captured the majority of these investments, with trading volumes up by 67% to $19.2 billion. This activity represented a significant 35% of Bitcoin’s trading volume on trusted exchanges.

Inflows To Digital Asset Investment Products Reach $2.2 Billion

The latest CoinShares report attributes recent crypto inflows to the upcoming US elections on November 5. Anticipation of a potential Republican victory appears to be fueling interesthttps://beincrypto.com/donald-trump-to-overhaul-us-crypto-rules/, as the GOP is often viewed as more favorable toward relaxed regulations on digital assets.

“We believe euphoria around the prospect of a Republican victory was the likely reason for these inflows as they were in the first few days of last week, as polls have turned, we saw minor outflows on Friday, highlighting how sensitive Bitcoin is to the US elections at present,” the report read.

Read more: How To Buy Bitcoin (BTC) and Everything You Need To Know

Bitcoin dominated last week’s inflows, with $2.15 billion reflecting investor confidence. A minor yet notable $8.9 million also flowed into short-Bitcoin products, hinting at some hedging among investors amidst Bitcoin’s strong price movement.

Meanwhile, Ethereum saw modest inflows totaling $9.5 million, displaying a marked difference in sentiment compared to Bitcoin and Solana, which received $5.7 million. Other altcoins, including Polkadot and Arbitrum, saw smaller investments, with $670,000 and $200,000 respectively.

Crypto Investment Inflows By Tokens
Crypto Investment Inflows By Assets. Source: CoinShares

This development is unsurprising given how the run-up to the US elections has catalyzed substantial interest in digital assets over the past few weeks. As BeInCrypto reported, October already saw inflows reaching $901 million in the last week after recording up to $2.2 billion in positive flows the week prior and $407 million in the first week of October.  

During these weeks, CoinShares’ James Butterfill credited the positive flows to a Republican victory potentially favoring regulatory policies for digital assets.

Fate of Crypto Investment Inflows After US Elections

The record-breaking inflows coincide with a broader surge in US-based investments in crypto, as American investors account for the bulk of this year’s $29.2 billion inflow. Meanwhile, Germany saw a modest $5.1 million in new investments. This reflects Europe’s more conservative engagement with crypto amid regulatory uncertainties.

Crypto Investment Inflows by Regions. Source: CoinShares
Crypto Investment Inflows by Regions. Source: CoinShares

While Bitcoin remains the primary beneficiary of these investments, US elections could further intensify volatility in the crypto market this week. Investors are monitoring key battleground states, where recent polls indicate a favorable swing for Republicans. This has raised speculation of a shift in Congress that could bring a friendlier stance on crypto.

Political analysts note that GOP control of Congress might ease regulatory pressures on digital assets. This could enhance investor confidence and attract further inflows into Bitcoin and other cryptocurrencies in the days following the elections. Nevertheless, others like Coinbase CEO Brian Armstrong say a more “pro-crypto Congress” is likely to emerge regardless of the election’s outcome.

The election results will likely signal the short-term direction for crypto investments. A Republican win could boost inflows, potentially sparking a new Bitcoin rally, while a Democratic victory might dampen expectations if stricter regulations are anticipated.

Read More: What is Polymarket? A Guide to The Popular Prediction Market

With election day approaching, crypto markets are expected to stay volatile, as Bitcoin and other digital assets respond to shifts in polling data and policy outlooks.

“Going to be an exciting week ahead, that’s one thing that’s for certain. Be careful on leverage, recommend not touching it at all this week. You’re likely to just get chopped up,” crypto analyst Daan Crypto warned.

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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3 US Economic Events to Watch for Crypto Market Impact

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Crypto markets are bracing for what is arguably the most volatile week in 2024. Three US macroeconomic data events are on the calendar and have the potential to affect investors’ portfolios significantly.

Meanwhile, Bitcoin (BTC) is trading below $70,000, with prospects for more gains as the fourth quarter (Q4) has historically boded well for the pioneer crypto.

US Elections: Donald Trump vs. Kamala Harris

The US market is approaching the climax of its political showdown between Donald Trump and Kamala Harris, from the Republican and Democratic parties, respectively, on Tuesday, November 5. Based on data on Polymarket, the US elections are only hours away, with Trump narrowly in the lead.

Read More: How Can Blockchain Be Used for Voting in 2024?

Donald Trump vs. Kamala Harris on US Elections
Donald Trump vs. Kamala Harris on US Elections. Source: Polymarket

Nevertheless, Polymarket’s industry peer in the prediction market, Kalshi, shows an almost similar margin, with Trump leading by 52% against Harris’ 48%. This contrast reflects the differences in these platforms’ user bases. Notwithstanding, analysts anticipate a volatile day for Bitcoin.

The US election results could have significant implications for economic policy, regulatory environments, and investor sentiment. Depending on the winner, policies regarding cryptocurrency might change, potentially affecting Bitcoin price, with the sentiment spilling over to other crypto tokens.

“I’m expecting this week to be a real firecracker, with lots of volatility. The Key day will be Tuesday, as the US election voting comes to a close. If there is no clear winner as the day progresses, it could get quite scary for Bitcoin,” said Mark Cullen, an analyst at AlphaBTC.

Initial Jobless Claims: Labor Market Gauge

Beyond the US elections, crypto markets will also monitor the initial jobless claims on Thursday, November 7. This economic data helps gauge the tightness or softness of the labor market in the US. While the job market has softened, unemployment rates remain low on an absolute basis.  

Last week, US citizens filing new applications for unemployment insurance came in at 216,000 from the week ending October 25, down from the previous 228,000. However, there is a consensus forecast of 220,000.

High initial jobless claims in the Thursday report suggest increasing economic hardship and a weakening labor market. This could lead to decreased consumer spending and investment in traditional assets like stocks and bonds. Consequently, some investors may turn to alternative assets like cryptocurrencies as a hedge against economic uncertainty.

FOMC Interest Rate Decision and Jerome Powell Speech

On Thursday, the Federal Open Market Committee (FOMC) will release minutes from its last meeting, followed by comments from Federal Reserve (Fed) Chair Jerome Powell. The Fed operates under a dual mandate: to keep inflation, as measured by the Consumer Price Index (CPI), at 2% annually, and to sustain full employment.

The FOMC’s November meeting is scheduled for next Wednesday and Thursday, with economists speculating on the possibility of another rate cut. At the previous meeting, the Fed reduced interest rates by 50 basis points (0.5%) as US CPI dropped to 2.4%.

Another rate cut may be likely as inflation nears the Fed’s 2% target, while the unemployment rate has risen from 3.7% to 4.1% this year, indicating potential softening in the job market.

Read more: How to Protect Yourself From Inflation Using Cryptocurrency

Recently, Powell said the downside risks to employment have increased, hinting at more rate cuts to support economic growth before the situation worsens. Moreover, the FOMC’s forecast in September suggested that the federal funds rate could fall by another 50 basis points before the end of 2024.

With only November and December meetings remaining, likely, two 25-basis-point cuts are likely underway. Against this backdrop, the CME Fed Watchtool shows a 99.9% probability of a 25 bps rate cut in the Thursday US economic data release.

FOMC Interest Rate Cut Probabilities. Source: CME Fed Watchtool

Meanwhile, Spotonchain anticipates a further upside for Bitcoin after the US elections and FOMC meeting, setting a BTC price target of $100,000 in 2024. The rally, Spotonchain says, will come regardless of who wins the elections.

“The market is entering its most volatile week with the US election and FOMC meeting, but this rally may be here to stay. Historically, the real bull run begins post-election, and we believe that whether Trump or Harris becomes the next president, BTC will continue its upward journey, potentially reaching 100,000 this year,” Spotonchain said.

At the time of writing, BTC is trading for $68,698, signifying a modest 0.34% surge since the Monday session opened.

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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