Here’s Why Bitcoin Price Fell Suddenly Below $65K
Bitcoin price dipped below $65,000 today, coinciding with significant BTC movements by the German Federal Criminal Police Office (BKA). According to Arkham, the BKA sent $425 million in Bitcoin to different wallets, including exchanges Kraken and Bitstamp, raising questions about the potential impact on the markets. German Government’s Bitcoin Transfer The German Federal Criminal Police The post Here’s Why Bitcoin Price Fell Suddenly Below $65K appeared first on CoinGape.
Bitcoin price dipped below $65,000 today, coinciding with significant BTC movements by the German Federal Criminal Police Office (BKA).
According to Arkham, the BKA sent $425 million in Bitcoin to different wallets, including exchanges Kraken and Bitstamp, raising questions about the potential impact on the markets.
German Government’s Bitcoin Transfer
The German Federal Criminal Police Office (BKA) moved a large volume of Bitcoin on June 19th. From the Arkham data, the BKA transferred 6,500 BTC worth $425 million from their wallet.
Of this, $32 million worth of Bitcoin was sent to Kraken and $32 million to Bitstamp. These transactions hint that there could be an intention to sell some of the holdings.
Post was just meant to highlight not to call for a massive pump/dump or anything. I personally didn't even know the German Government seized that much #Bitcoin earlier this year.
Fwiw, more often than not these transfers are around local bottoms not tops the moment people find…
— Daan Crypto Trades (@DaanCrypto) June 19, 2024
The Arkham CEO Miguel More claimed that the entity cashed out $130 million of BTC to the so-called service wallets, which is a hint of an imminent selling. The transfer was first spotted by the Mantle blockchain strategist @Defi_Maestro on the social platform X, suggesting that it could cause a stir in the market.
Seizure of BTC by BKA
The BKA’s Bitcoin is derived from the confiscation of around 50,000 BTC from the owners of Movie2k.to, a movie streaming service that was operational in 2013. The BKA got the money in mid-January 2024 after the suspects made a ‘voluntary contribution’ to the organization.
From February, the German government-labeled wallet contained this amount of Bitcoin until the recent transfer.
According to Arkham, the wallet initiated several transactions on June 19, with one being an output of 6,500 BTC and another input of 2,500 BTC to the wallet address. This move stirred the crypto enthusiasts, and everyone began to wonder about the German government’s selling motives.
Bitcoin Market Reaction and Price Trend
The information on BKA’s Bitcoin transactions affected the market sentiment shortly after the announcement. Analysts pointed out an increase in the number of short positions and a mild decrease in the price of Bitcoin after the transfers. The price of Bitcoin, consequently, dropped below $65,000 as it had done in the past during large transactions by government bodies.
Nevertheless, the real number of BTC transferred to Kraken and Bitstamp was about 500 BTC each, which some analysts believe should not lead to a major change in the market. However, the knowledge that a government is liquidating assets may cause short-term market fluctuations.
Concurrently, crypto analyst Ali Charts noted that Bitcoin has fallen below the +0.5σ MVRV pricing band to $67,890, pointing towards a correction towards the mid-price band of $54,930. By comparing the MVRV ratio against the 1-year SMA, we see that the momentum is indeed downward, this means that Bitcoin is being traded at a loss compared to some of its earlier acquisition prices.
BTC Derivatives Data
The recent activity by the German government has also coincided with other market indicators that are sending mixed signals. Bitcoin’s dominance fell sharply by 0.93% to 54.31%, meaning investors are apparently in the altcoins. The Bitcoin exchange balance also had a small net outflow, which is considered bullish as traders prefer to keep the Bitcoins rather than sell them.
The Crypto Fear & Greed Index fell by 13.51% to 64, which is still within the ‘greed’ territory, meaning that the overall sentiment remains optimistic despite the recent retracement. However, the volume of open interest in Bitcoin futures and options has been rising, which indicates more speculation and institutional investors.
Source: Coinglass
Funding rates, on the other hand, are slightly positive, which means that traders are ready to keep the longs open even after the price rolls back. This overall market behavior indicates that although the BKA’s transactions have led to a near-term decline, the long-term market sentiment still remains positive.
Read Also: Reasons Why Bitcoin Is Struggling Despite Crypto Market Is Up On Wednesday
The post Here’s Why Bitcoin Price Fell Suddenly Below $65K appeared first on CoinGape.
