Bitcoin

Bitcoin Sales Impacting the Market

The crypto market is facing some tough times in the third quarter of 2024. One major issue is the German government’s Bundeskriminalamt (BKA) selling off a lot of Bitcoin. Since mid-June, they reduced their Bitcoin holdings from around 50,000 BTC ($3.55B) to less than 5,000 BTC ($285M) by July 11 and then to 0 shortly after. This selling is creating a supply overhang that is putting pressure on Bitcoin prices. Even though their sales aren’t huge compared to the daily trading volume of $10.6B, the way they are selling is making the market nervous.

Mt. Gox Repayments and Market Uncertainty

Another issue affecting the market is the Mt. Gox Rehabilitation Trust repayments that started on July 5. These repayments are relevant because it’s not clear how much of the repaid Bitcoin is being sold. Different exchanges process these repayments at different speeds, adding to the uncertainty. For example, Bitstamp processes immediately, while Kraken can take up to 90 days. This uncertainty is damaging to the market more than the actual selling because it creates fear and hesitation among investors.

Recession Fears and Economic Productivity

Looking ahead, there is concern that the US might fall into a recession later this year or in early 2025. Some reports suggest this slowdown could be serious. However, others believe that technological advancements, like generative artificial intelligence, will boost productivity and kickstart a new economic cycle as early as the fourth quarter of 2024. Predicting this is challenging, and opinions are divided.

Federal Reserve and Interest Rate Cuts

The US economy has shown signs of slowing down, as seen in various macroeconomic data like ISM manufacturing and unemployment rates. It’s likely that the economy peaked in the second quarter of 2024. This slowdown is one reason why many expect the Federal Reserve to cut interest rates starting in September. The recent CPI print from June, which came in lower than expected, supports this expectation. However, there is concern that if the economy does fall into a recession, these cuts may not be enough to boost markets.

Crypto Market Volatility in 3Q24

For now, the crypto market is expected to remain volatile in the third quarter of 2024. The market lacks strong narratives, and there is uncertainty about potential spot ETH ETF flows. This could mean that ETH might see some support, even if these flows take time to happen. Overall, the next two months are likely to see more volatility before things potentially improve in late September.

Takeaways from EthCC

The 7th Ethereum Community Conference (EthCC) highlighted several key themes. One major focus was on Layer-2 (L2) scaling and differentiation. Panels and discussions, including a keynote by Ethereum co-founder Vitalik Buterin, reaffirmed Ethereum’s roadmap as a secure and decentralized Layer-1 (L1) settlement layer for various L2s.

Ethereum’s Roadmap and Scaling

Ethereum aims to be a secure settlement L1, focusing on increasing data availability bandwidth for L2 storage rather than scaling its execution layer significantly. This means that while ETH’s utility is not stagnating, the execution layer won’t see major scaling changes in the near term. Instead, L2 platforms like Optimism, Base, Arbitrum, and Starknet are showcasing their unique technological and ecosystem advantages, competing rapidly due to the modular approach of Ethereum.

Interoperability Challenges

Interoperability between L2s remains a contentious issue. While there are many feasible solutions with different tradeoffs, there isn’t a dominant standard yet. Interoperability protocols must find ways to monetize adoption, making this a near-zero-sum game. Full interoperability may take months or years to establish clear standards, but this doesn’t mean it will stop user onboarding.

Improving Crypto User Experience

Account abstraction and smart account adoption are gaining momentum. Developers are focusing on simplifying the decentralized application (dApp) experience with gas abstraction and bundled transactions. Session key technology, which allows automatic transaction approval under certain conditions, shows promise in reducing user experience friction, especially in DeFi (swaps) and gaming.

Staking and Liquid Staking Tokens

Staking was another big topic at EthCC. The rising staking ratio, now at 28% of total ETH supply, and the resulting decrease in net staking APY could pose challenges for solo stakers. There are also concerns about the centralization of liquid staking tokens (LSTs). Suggestions to address these issues include lowering the base issuance curve and creating LST standards to encourage diversity and competition. Restaking faces challenges with implementation timelines and uncertainty about the significance of AVS-based yield.

Focus on Infrastructure and Consumer Apps

The main EthCC event focused heavily on infrastructure, though there were also many consumer-facing apps showcased. These ranged from AI-parsed blockchain data applications to perpetual onchain games and novel prediction markets. Despite this, the ratio of infrastructure projects to consumer apps was higher than many had hoped.

Conclusion

The third quarter of 2024 is shaping up to be a volatile period for the crypto market. Factors like the Bundeskriminalamt’s Bitcoin sales, Mt. Gox repayments, US recession fears, and Federal Reserve interest rate cuts are all contributing to market uncertainty. However, advancements in Ethereum’s roadmap, interoperability challenges, and improvements in the crypto user experience are areas of focus that could drive future growth. While volatility is expected to continue in the near term, the potential for recovery and growth remains as we approach the end of the quarter.

Survey Finds Over 80% of Crypto Investors Bullish, Believing Bull Run Continues

Introduction

Bitcoin’s recent price struggles have not dampened market sentiment, with over half of crypto investors still bullish. According to a CoinGecko survey of 2,588 respondents, 82% believe the crypto bull run isn’t over, with more than 50% suggesting it’s still in its early stages.

Crypto Bull Run is Not Yet Over

The survey revealed distinct sentiments across different roles in the crypto community. About 55.5% of investors see the bull run in its early stages, while 28.8% believe it’s in the middle. Overall, 84.3% of investors think the market green run is ongoing.

Different Views Among Market Participants

However, traders and builders are more cautious. According to the survey, 78.6% of traders and 74.9% of builders believe that the crypto bull run is not over. Unsurprisingly, market participants tagged as spectators showed the most pessimism, with only 69% believing that the bull run could continue.

Experience Levels and Market Sentiment

Meanwhile, the bullish optimism appears evenly distributed among market participants regardless of their experience levels in crypto. Per the survey, around 52.7% of those with 0-3 years of experience, 52.2% with 4-7 years, and 51.8% with 8 or more years believe the market is in the early stages of a bull run.

“In other words, having different years of crypto experience did not seem to significantly influence how participants viewed the current cycle’s bull run. Instead, there was a similar distribution of optimistic and pessimistic opinions,” CoinGecko stated.

Crypto Investors’ Bull Market Sentiment

CoinGecko pointed out that 60.4% of participants think the market hasn’t peaked and will rise again, while 21.3% anticipate a supercycle with continued gains. This suggests that Bitcoin’s over $73,000 all-time high in March could be easily surpassed in the current market cycle.

“In other words, a combined 81.7% of participants believed that the market would see a bullish continuation, either because crypto had yet to peak or had entered a supercycle state. This further reinforces the above consensus view that the current crypto bull run is not over yet and still has upside potential,” CoinGecko added.

Expert Opinions Align with Survey Results

The survey results align with those of market experts, who believe the crypto market is in the midst of a bull run. Matt Hougan, the Chief Investment Officer for asset management firm Bitwise, explained that key tailwinds could drive Bitcoin to $100,000 by year-end.

“The crypto market is facing a weird dynamic right now: All the short-term news is bad, and all the long-term news is good. The dichotomy is creating an incredible potential opportunity for long-term investors,” he commented.

Altcoin Season and Investment Opportunities

Read more: 11 Cryptos To Add To Your Portfolio Before Altcoin Season. The survey findings suggest now could be a good time to look into promising altcoins. With many experts and investors feeling positive about the future of the crypto market, adding a variety of altcoins to your portfolio might be a smart move.

Conclusion

In summary, despite Bitcoin’s recent price struggles, the overall market sentiment remains strong. The CoinGecko survey shows that a majority of crypto investors believe the bull run is not over. Different roles in the crypto community have varying levels of optimism, but overall, the sentiment is positive. Experience levels in the crypto market also do not seem to significantly affect this bullish outlook. Experts and market participants alike predict that the market has not yet peaked and anticipate further gains, with some even expecting a supercycle. This ongoing bullish sentiment suggests that the crypto market still has a lot of potential for growth.

Bitcoin Bottom Signal? German Government Runs Out of BTC to Sell

Key BTC Price Levels Emerge as Bitcoin Hits $58K on ‘Sticky’ US PPI

Bitcoin’s price hit $58,000 around July 12 when Wall Street opened. This happened as markets reacted to the “sticky” United States inflation data.

Bitcoin Joins Stocks in Positive PPI Reaction

Data from Cointelegraph Markets Pro and TradingView showed that Bitcoin’s strength improved as the Producer Price Index (PPI) print for June rose more than expected. The year-on-year PPI came in at 2.6%, higher than the expected 2.3%, and 0.1% more than the previous month.

“On an unadjusted basis, the index for final demand rose 2.6 percent for the 12 months ended in June, the largest advance since moving up 2.7 percent for the 12 months ended March 2023,” said the US Bureau of Labor Statistics.

While the July 11 Consumer Price Index (CPI) numbers showed a different story, BTC/USD avoided a downturn. Instead, it gained modestly along with US stocks while the dollar weakened.

Analyst Insights on PPI Data

Popular trader Skew noted that while prices for energy, food, and trade services were rising, the overall PPI was “sticky.” He pointed out that without these sectors, the index was “basically flat,” which was less surprising for the markets.

He observed that initial market reactions showed the US Dollar Index (DXY) and yields rising before falling again. This indicated a market shift, expecting a tough future if demand continues to weaken. He mentioned that stocks like NQ and ES might recover as hedges are removed, with end-of-day performance being crucial.

The US Dollar Index (DXY) dropped 0.35% on July 12, reaching its lowest level in over a month.

Bitcoin Order Book and Market Health

Skew described the order book on Binance, the largest global exchange, as “pretty healthy.” He noted that although the order books leaned towards buying, it was important to see this translate into actual market activity.

Higher BTC Price Daily Close Needed

Other analysts demanded a stronger BTC/USD to consider a long-term recovery. Popular trader Rekt Capital highlighted that Bitcoin needed to close above $58,350 daily to break the Lower High and aim for $60,600. He shared an explanatory chart showing Bitcoin challenging the Lower High resistance again.

German Government’s Bitcoin Holdings and Market Impact

Bitcoin’s price could be on track for a reaccumulation phase as the German government is out of Bitcoin to sell. According to Arkham Intelligence, as of July 12, 2024, the German Government (BKA) held no more Bitcoin. They had transferred their Bitcoin to major exchanges like Coinbase, Kraken, and Bitstamp, as well as to trading firms like Flow Traders and a wallet linked to B2C2 Group.

On July 12 at 15:02 UTC+8, the government continued its transfer activity, moving 1,200 BTC equally among Bitstamp, Kraken, and Coinbase (400 BTC each). They also transferred 1,000 BTC to an address suspected to belong to B2C2 Group and 500 BTC to an unmarked address. Interestingly, in two separate transfers early on Friday morning, 4,169 BTC were received back from Coinbase, Kraken, and Bitstamp, possibly due to a failed sell transaction.

These movements reduced the German Government’s Bitcoin holdings significantly from 9,094 BTC. A research note by 10x Research on Friday stated that the selling pressure from the German government is easing and Bitcoin appears technically oversold. ETFs are buying the dip, and the Fed is expected to cut interest rates soon, which could provide the liquidity support anticipated by many.

“If the Fed cuts rates solely due to inflation concerns in September 2024, it could be short-term bullish for Bitcoin. However, if growth concerns drive the cut, either in September or later, Bitcoin might face significant selling pressure,” the report stated.

MicroStrategy’s 10-for-1 Stock Split

MicroStrategy, the largest corporate holder of Bitcoin, announced a 10-for-1 stock split. The shares rose about 6% but are still 34% off an all-time high of $1,999.99, reached in March. This move comes during a lull in Bitcoin’s price, which has been stuck in a tight range for four months.

MicroStrategy’s stock split will create class A and class B common stock, aiming to make the stock more accessible to investors and employees. The shares rose about 6% but are still 34% off their all-time high of $1,999.99, reached in March.

The company plans to pay a dividend on August 1, giving shareholders an additional nine shares for every one they hold. Trading on a post-split basis will begin on August 8.

MicroStrategy started as an enterprise software provider but began aggressively buying Bitcoin in 2020. It has mainly traded as a proxy for Bitcoin’s price since then. This February, the company announced it would focus more on Bitcoin development.

Bernstein recently said that MicroStrategy is “building the world’s largest Bitcoin company” and has about 80% upside. MicroStrategy’s stock is up 106% this year compared to Bitcoin’s 38% gain, and 216% in the past 12 months compared to Bitcoin’s 91% advance.This article provides a comprehensive look at the recent developments in Bitcoin’s price and market trends. The German government’s Bitcoin sales and the latest US PPI inflation data have impacted the market. As Bitcoin navigates these events, it remains crucial to watch key price levels and market reactions.

On-chain data suggests that Satoshi’s original vision for Bitcoin is alive and kicking as the Bitcoin network is shifting towards smaller transactions.

Bitcoin P2P Payment Transfers on the Rise

Recently, there has been a noticeable increase in Bitcoin peer-to-peer (P2P) payment transfers. According to CryptoQuant founder and CEO Ki Young Ju, there is a significant pattern shift in Bitcoin transactions. More transactions are now classified as P2P payments.

Bitcoin Transaction Fees Trend

Ki Young Ju discussed the trend in Bitcoin transaction fees. Transaction fees are what senders pay to validators on the blockchain. The chart below, shared by Ju, compares median transaction fees on Bitcoin and Ethereum over the past decade.

Bitcoin vs. Ethereum Transaction Fees

The chart shows that Bitcoin’s median transaction fees were higher than Ethereum’s before 2021. However, since then, Bitcoin’s fees have generally been lower. Ju noted that contrary to popular belief, Bitcoin transaction fees have been cheaper than Ethereum’s for most of the time since 2021. Currently, the median fee on Bitcoin is around $0.40, while on Ethereum, it’s about $0.68. This means users would only use Bitcoin for larger transfers to make the fee worth it.

Filtering for P2P Payments

Considering the transaction fee rate of 1-3% in developing countries, the lower limit for a feasible transaction would be $13-40. To identify transactions likely representing P2P payments, Ju analyzed those between $40 to $1,000. The graph below shows the daily median transaction value and daily transaction count for various periods.

Bitcoin Small Transactions

The chart excludes transactions related to Runes and Ordinals protocols, as these do not represent real-life P2P payments. It shows that the median size of Bitcoin transactions was higher from 2019 to 2022 but has become smaller since 2023.

Increase in Bitcoin Transactions

Not only have transaction sizes become smaller, but the number of transactions has also increased. This suggests many small moves are happening, likely due to real-life P2P payments. Ju believes this trend indicates that Bitcoin is developing in the right direction, aligning with Satoshi’s original vision.

Bitcoin’s Adherence to Satoshi’s Vision

While some might think Bitcoin hasn’t lived up to Satoshi Nakamoto’s vision, the data suggests otherwise. Bitcoin is becoming more suitable for small P2P payments, showing that it is developing as intended.

BTC Price and Market Trends

Currently, Bitcoin’s price is around $57,800. Despite recent market fluctuations, the increase in small P2P transactions is a positive sign for Bitcoin’s future. This trend indicates growing adoption of Bitcoin for everyday transactions, staying true to Satoshi’s vision of a peer-to-peer electronic cash system.

Conclusion

In summary, on-chain data shows that Bitcoin is shifting towards smaller, peer-to-peer payments. The trend in transaction fees, the increase in small transactions, and the overall development of the Bitcoin network suggest that Satoshi Nakamoto’s vision is still alive. Bitcoin is evolving into a practical mode of payment for everyday use, aligning with its original purpose.

This rise in P2P transactions is a promising sign for Bitcoin’s future, indicating its growing use in real-life scenarios. As Bitcoin continues to develop, it is likely to see even more adoption as a peer-to-peer payment system.

WHICH COUNTRIES TRADE CRYPTO THE MOST?

A Comprehensive Analysis

The global cryptocurrency market has grown a lot in the past few years. Many people now accept and use digital assets. We studied 136 countries to see how much they trade crypto. We looked at four important factors: web traffic, website language, headquarters location, and trading time zone. This helped us understand which countries are the biggest players in the crypto market.

HOW WE DID OUR STUDY

Our study started by listing centralized exchanges (CEX) with trust scores above 6 from CoinGecko. Since crypto trading data is decentralized, we used a special method to estimate the trading volume for each country. We looked at web traffic by country, supported languages, headquarters location, and trading time zones. These factors were weighted to estimate the trading volume for each exchange. You can find the detailed methodology at the end of this article.

KEY FINDINGS

1. Global Trading Volume: In 2024, the global cryptocurrency trading volume is expected to exceed $108 trillion, which is almost 90% higher than in 2022.
2. United States: The U.S. has the highest estimated crypto trading volume in 2024, surpassing $2 trillion.
3. Europe: Europe leads in crypto trading, accounting for 37.32% of global transaction value.
4. Turkey and India: Turkey and India are ranked 2nd and 3rd globally, each with trading volumes exceeding $1 trillion.
5. Binance: Binance is the most widely used crypto exchange, leading in 100 out of 136 countries.

SIGNIFICANT SURGE IN GLOBAL CRYPTO TRADING VOLUME

Global cryptocurrency trading volume has increased by 42% since 2023. Over the past three years, the market has grown by 89%. This shows the growing acceptance and adoption of digital assets worldwide.

Europe has become a leader in this market, making up 37.32% of global cryptocurrency transaction value. Europe is a hub for crypto innovation and investment due to progressive regulatory frameworks and a tech-savvy population. Asia follows closely, contributing 36.17% to the world’s cryptocurrency transaction value. High mobile penetration, strong tech infrastructure, and rising institutional interest help Asia grow quickly in crypto.

ESTIMATED CRYPTO TRADING VOLUME OVER THREE YEARS (2022-2024)

Europe’s cryptocurrency trading volume is expected to reach $40.5 trillion in 2024, up from $15 trillion in 2022. In 2023, the volume was nearly $19.9 trillion. This growth highlights Europe’s strong influence in the global crypto market, thanks to its financial infrastructure, progressive regulations, and rising adoption of digital assets.

CRYPTO TRADING IN EUROPE

Europe accounts for 37.32% of global cryptocurrency transaction value, showing it is a key player in the global crypto market. The continent’s strong financial infrastructure and progressive regulatory environment make it a hub for crypto trading.

• Russia: Russia leads Europe in cryptocurrency trading and is among the top five globally, with an estimated trading volume exceeding $633 billion.
• United Kingdom: The UK follows closely, with a trading volume of over $624 billion, making it the second-largest market in Europe and sixth worldwide. London is a highly crypto-ready city due to its advanced financial services and supportive government policies.
• Slovenia: Slovenia has the highest monthly cryptocurrency expenditure per capita, with individuals spending an average of $2,609 per month on crypto.
• Ukraine: In Ukraine, cryptocurrency is crucial amid economic instability, with citizens spending nearly three times their monthly rent on crypto.

TOP CRYPTO EXCHANGES

Binance leads the crypto exchange market, dominating in 100 countries with a trading volume of $2.77 trillion. Binance US also dominates in 100 countries, but with a much lower trading volume of $3.9 billion.

Other notable exchanges include:

• OKX: Leading in 93 countries with a trading volume of $759 billion.
• CEX.IO: Leading in 92 countries with a trading volume of $1.83 billion.
• Coinbase Exchange: Leading in 90 countries with a trading volume of $662 billion.
• Bybit: Leading in 87 countries with a trading volume of $1.14 trillion.

These figures show the competitive landscape of crypto exchanges, with Binance maintaining a substantial lead in both geographical dominance and trading volume.

REGIONAL CRYPTO TRADING HIGHLIGHTS

• Europe: Europe’s crypto trading volume is expected to reach $40.5 trillion by 2024. Russia and the UK are major contributors.
• Asia: Asia accounts for 36.17% of the world’s cryptocurrency transaction value. High mobile penetration and strong tech infrastructure drive this growth.
• Africa: Africa ranks third, showing steady growth in crypto adoption and trading.
• South America: South America is emerging in the crypto space, with increasing trading volumes.
• North America: North America continues to be a significant player, with the U.S. leading in global trading volumes.
• Oceania: Oceania is growing in the crypto market, with rising adoption and trading volumes.

CONCLUSION

Cryptocurrency use and exchange are changing the global economy. Europe and Asia are leading the way, with significant contributions from other regions. As the market continues to develop, it will be essential to watch these trends and their impact on the global financial system and individual economies.

Germany Dumps Bitcoin on the Market

Germany has been selling a lot of Bitcoin recently. This week, they sent billions of dollars worth of Bitcoin to exchanges and market makers. Because of this, they don’t have much Bitcoin left to sell.

Big Bitcoin Sale Nears End

For weeks, there has been a lot of pressure to sell, and the crypto community has been worried. The German government is almost finished with their big Bitcoin selling campaign.

Back in June, Germany held 50,000 BTC. At today’s prices, that was worth $2.8 billion. These Bitcoins were taken from the owners of the film piracy site Movie2k in January of this year. Now, blockchain experts say the German government has moved most of those funds out of its digital wallet.

Bitcoin Holdings Shrink

As of today, data from Arkham Intelligence shows that Germany has only 6,435 BTC left in their wallets. That’s about $284 million at the current price. Early Thursday, German officials transferred a lot of Bitcoin to exchanges and market makers.

Where Is the Bitcoin Going?

Since June 20, Germany has sent billions of dollars in Bitcoin to places like Kraken, Coinbase, and Bitstamp. They have also sent Bitcoin to wealth management firm Cumberland and other addresses that are likely over-the-counter or institutional trading desks.

At first, the outflows were moderate. But earlier this week, the government sent out $900 million from its wallet on Monday alone.

Impact on Bitcoin Price

Most analysts believe that sending Bitcoin to trading platforms means it’s being sold on the market. This has added to the selling pressure, causing Bitcoin’s price to drop. On Thursday, Bitcoin was trading at $57,500, down 13% over the last month.

Transfer Doesn’t Always Mean Sale

Transferring Bitcoin to an exchange doesn’t always mean it will be sold. Sometimes, the government gets Bitcoin back into its wallet after sending it to an exchange, like Kraken.

Nearing Zero Balance

Despite this, the state’s Bitcoin balance is quickly heading towards zero. This means the government’s threat to crash the market may soon be over. Some Bitcoin investors think Germany is missing out on future gains by selling now.

Future Geopolitical Blunder?

Capriole Investments founder Charles Edwards tweeted, “In a few years, this will be looked back on as one of the biggest geopolitical blunders of all time. It will be studied in universities.”

Conclusion

Germany’s massive Bitcoin selloff is almost over. With only $369 million worth of Bitcoin left, the impact on the market is significant. While some see this as a missed opportunity, others are glad the selloff is ending. The future will tell if this was a wise move or a major mistake.

Bitcoin and Ethereum: Digital Commodities, Says CFTC Chair

Introduction

Bitcoin and Ethereum are now officially considered digital commodities. The CFTC Chair, Rostin Behnam, has confirmed this after an Illinois court ruling. This decision has big implications for the world of cryptocurrencies, especially with ongoing debates about whether they are commodities or securities.

The Illinois Court Ruling

Recently, an Illinois court ruled that both Bitcoin and Ethereum are digital commodities under the Commodity Exchange Act. This ruling supports the view of the Commodity Futures Trading Commission (CFTC), which oversees commodity markets. CFTC Chair Rostin Behnam stated that this decision reaffirms the status of Bitcoin and Ethereum as commodities.

CFTC vs. SEC: The Regulatory Debate

There has been a lot of debate about whether cryptocurrencies should be regulated as securities by the SEC or as commodities by the CFTC. At a Senate Committee hearing, CFTC Chair Behnam mentioned that 70% to 80% of cryptocurrencies are not securities. This means that most cryptocurrencies should fall under the CFTC’s regulation.

Bitcoin and Ethereum: Not Securities

For years, there has been confusion about whether cryptocurrencies like Bitcoin and Ethereum are securities. The SEC has been involved in several lawsuits against crypto companies, claiming they sold unregistered securities. These include cases against exchange platforms like Coinbase and the Ripple company for its XRP token.

The recent statements by the CFTC Chair have helped clear up some of this confusion. Behnam emphasized that Bitcoin and Ethereum are commodities, not securities. This distinction is important because it determines which regulatory body has authority over these digital assets.

Market Performance of Bitcoin and Ethereum

Bitcoin and Ethereum have both been performing well in the market. On Wednesday, Bitcoin was trading above $57,000, while Ethereum was above $3,000. These levels are key support levels, showing strength in the market.

The Role of the CFTC

During the Senate Committee hearing, there was discussion about whether the CFTC should have more control over the regulation of cryptocurrencies. Senator Roger Marshall suggested that the entire responsibility for regulating digital assets should be given to the CFTC. CFTC Chair Behnam agreed, stating that the CFTC has the expertise and capacity to handle this responsibility.

Regulatory Challenges and Crypto Fraud

One of the major challenges in regulating cryptocurrencies is dealing with crypto fraud. CFTC Chair Behnam highlighted that the unique technology behind digital assets requires a different approach to cybersecurity and operational resilience compared to traditional assets. Senator Cory Booker raised concerns about market abuse and the need for the SEC and CFTC to address these issues.

Importance of Clear Regulations

Clear regulatory frameworks are crucial for the growth of the cryptocurrency market. CFTC Chair Behnam emphasized the need for transparency and proper regulations during the Milken Institute’s Global Conference. He predicted that there would be more enforcement actions in the coming years due to increased interest from retail investors.

Taxation in the Crypto Space

Taxation is another important issue for the cryptocurrency market. During the Senate hearing, Senator Tommy Tuberville expressed concerns about the IRS taxing Bitcoin miners regardless of their profitability. CFTC Chair Behnam acknowledged his limited knowledge on this issue but agreed that a swift resolution is needed to prevent unfair taxation.

Coordination Between SEC and CFTC

Although the SEC and CFTC coordinate enforcement actions, there is still a lack of regulatory coordination between the two agencies. This can lead to confusion and inefficiencies in the regulation of digital assets. A more streamlined approach, where the CFTC has primary responsibility, could help address these issues.

Conclusion

The confirmation that Bitcoin and Ethereum are digital commodities is a significant development for the cryptocurrency market. The Illinois court ruling and the statements by CFTC Chair Rostin Behnam provide clarity in the ongoing debate about the classification of cryptocurrencies. With Bitcoin and Ethereum trading strongly, and the possibility of the CFTC taking on a larger regulatory role, the future of digital asset regulation looks promising. Clear and coordinated regulatory frameworks are essential to ensure the growth and stability of the cryptocurrency market.

Bitcoin Price Decline on Germany, Mt. Gox and Miner Sell Pressure May Be Overblown

Bitcoin has dropped 15% over the past month, causing worry among investors. Many blame this decline on selling pressure from Bitcoin mining operators, Mt. Gox refunds, and recent events in Germany. However, some experts believe these fears may be exaggerated. This could be a good buying opportunity for investors.

Causes of Bitcoin Price Decline

Bitcoin Mining Operators

One of the main reasons for the Bitcoin price decline is the selling pressure from Bitcoin mining operators. These operators sell their Bitcoin to cover costs, especially when prices are high. This creates extra selling pressure, which can drive prices down.

Mt. Gox Refunds

Another factor is the Mt. Gox refunds. Mt. Gox was a major Bitcoin exchange that went bankrupt in 2014. Recently, there have been movements in Bitcoin addresses linked to Mt. Gox, sparking fears of a large sell-off. Investors worry that this could flood the market with Bitcoin and drive prices lower.

German State of Saxony

The German state of Saxony has also played a role in the Bitcoin price decline. There have been concerns about the German government selling its Bitcoin holdings. This has added to the selling pressure, causing further declines in the Bitcoin price.

Market Reactions and Analysis

Irrational Fears and Buying Opportunity

Despite these concerns, some experts believe the fears are irrational. Analysts suggest that the selling pressure from mining operators, Mt. Gox refunds, and the German state of Saxony is not as significant as it seems. They argue that this is a good buying opportunity for investors.

Bitcoin Whales Accumulation

Bitcoin whales, or large Bitcoin holders, have been buying more Bitcoin during the price decline. According to a CryptoQuant report, these whales are accumulating Bitcoin at the fastest rate in over a year. This indicates that they believe the price will rise again.

Onchain Metrics and Technical Analysis

Several onchain metrics signal that Bitcoin could face further declines. The profit and loss (P&L) index is hovering around its 365-day moving average (MA). If it drops below this level, Bitcoin could experience a major correction. However, the current market conditions also suggest that a local bottom could form, providing a chance for prices to rebound.

Impact of Tether and Stablecoin Liquidity

Tether’s Market Cap Growth

Tether (USDT), a popular stablecoin, has seen its market cap growth stall. This is significant because the growth of stablecoin liquidity is often linked to Bitcoin bull markets. When stablecoins like Tether increase in value, it usually means there is more money available to invest in Bitcoin. The current stall suggests that a rally might be difficult to achieve.

Historical Recoveries and Liquidity

Historical recoveries in Bitcoin’s price have often been driven by an increase in stablecoin liquidity. If Tether’s market cap begins to grow again, it could signal the start of a new bull market for Bitcoin.

Federal Reserve and Market Sentiment

Federal Reserve Warning

Federal Reserve Chair Jerome Powell recently issued a critical warning that has affected market sentiment. This warning, combined with the other factors mentioned, has contributed to the extreme fear and volatility in the Bitcoin market.

China’s Influence on Bitcoin

Crypto entrepreneur Justin Sun has hinted that China might change its stance on Bitcoin and crypto. This has led to speculation that China could play a major role in the future of Bitcoin. Any positive news from China could potentially boost Bitcoin’s price.

Bitcoin’s Technical Resistance Levels

Short-Term Resistance at $59,000

Bitcoin’s short-term resistance level is at $59,000, which is also the 200-day simple moving average. For Bitcoin to avoid further losses, it needs to break above this level and turn it into support. This would signal a stronger market and potentially lead to higher prices.

Trend Line and Support

Bitcoin has been below this resistance level since early July. To turn the trend around, bulls need to flip this resistance into support. If they succeed, it could prevent further declines and stabilize the market.

Market Structure and Investor Behavior

Market Structure Remains Strong

Despite the recent decline, the overall market structure of Bitcoin remains strong. According to a Glassnode report, Bitcoin has experienced deeper corrections in the past. The current drawdown is relatively shallow compared to previous cycles, indicating a robust underlying market.

Short-Term Holders’ Unrealized Losses

Many short-term holders are currently experiencing unrealized losses. This means they bought Bitcoin at higher prices and are now holding it at a loss. While this can create selling pressure, the overall magnitude of losses is not as severe as in past bear markets.

Long-Term Holders’ Profitability

Long-term holders, on the other hand, remain profitable. These investors bought Bitcoin at much lower prices and are still in the green despite the recent declines. Their continued profitability suggests that the market has strong support from seasoned investors.

Conclusion and Takeaways

Bitcoin’s recent price decline has been driven by several factors, including selling pressure from mining operators, Mt. Gox refunds, and concerns about the German state of Saxony. Despite these issues, experts believe the fears may be overblown, presenting a buying opportunity for investors. Bitcoin whales are accumulating, and the overall market structure remains strong. While short-term holders are facing unrealized losses, long-term holders continue to be profitable. With potential influences from stablecoin liquidity and positive news from China, Bitcoin’s future remains uncertain but potentially promising. Investors should stay informed and consider these factors when making decisions about Bitcoin.

Bitcoin Dip Buying Spree

Bitcoin’s price recently dropped, but investors are still buying. In just two days, Bitcoin ETFs saw $438 million in inflows. BlackRock’s IBIT ETF led the way with $180 million in purchases.

Record Inflows on a Single Day

Bitcoin ETFs recorded nearly $300 million in inflows on a single Monday. This is the highest level of buying activity since early June when Bitcoin was trading above $70,000. According to Bloomberg, over $438 million was poured into US ETFs in just two days.

BlackRock’s IBIT ETF was the top performer with nearly $180 million in purchases. Following IBIT, Fidelity’s FBTC also saw significant inflows. Grayscale’s GBTC, which usually sees outflows, recorded over $25 million in purchases.

Factors Influencing Bitcoin Buying

These strong inflows come at a time when Bitcoin is facing selling pressure from multiple sources. One major source is the repayments related to the defunct Mt. Gox exchange. Another source is the German government, which is moving large amounts of Bitcoin to exchanges.

Some analysts believe that investors see this selling pressure as a buying opportunity. CoinShares reported total inflows of $441 million into digital asset investment products for the week. Despite this, trading volumes in exchange-traded products remained relatively low at $7.9 billion, which is typical for summer.

Historical Trends and Current Data

Historically, July has been a bullish month for the crypto market, with a median return of 9%. Many traders expect this trend to continue. Data from SoSoValue shows that the cumulative net inflow for Bitcoin has reached $15 billion, with the daily net inflow at $294 million. The total net assets across these ETFs stand at $49.32 billion, with Bitcoin priced at $55,844.2 at the time of reporting.

This data suggests that despite recent price volatility and selling pressure, institutional interest in Bitcoin through regulated ETF products remains strong. Investors’ willingness to buy during price dips could potentially support Bitcoin’s value in the face of current market challenges.

Spot Bitcoin ETFs See Record Inflows

US spot Bitcoin exchange-traded funds (ETFs) attracted approximately $295 million in inflows on Monday. This was amid ongoing selling pressure from the German government and Mt. Gox repayments. According to SoSoValue, this marks the highest level of single-day inflows in a month.

BlackRock’s IBIT fund led with $187 million in inflows while Fidelity’s FBTC reported $61.5 million. Meanwhile, Grayscale’s GBTC saw $25 million in inflows. Bitwise’s BITB, ARK 21Shares’ ARKB, and VanEck’s HODL followed with $11 million, $8 million, and $1.5 million, respectively. The remaining funds saw no inflows.

BlackRock’s iShares Bitcoin Trust currently holds over $17 billion in assets under management, according to updated data from its official domain.

Selling Pressure from Government and Mt. Gox

The crypto market has been trending downward over the past few weeks. This followed the Mt. Gox repayment announcement and recent wallet activities by the US and German governments.

Since early July, the German government has been constantly selling Bitcoin. According to Arkham Intelligence, the government currently holds around 27,400 BTC, worth $1.5 billion. After recent BTC transfers, the German authorities sold almost half of their BTC holdings, which originally stood at around 50,000 BTC.

Mt. Gox’s Rehabilitation Trustee confirmed that it had initiated the repayment process last Friday. As part of the plan, Mt. Gox’s victims will not receive Bitcoin and Bitcoin Cash repayments directly but through designated crypto exchanges.

These events have likely increased selling pressure across the crypto market. Bitcoin was down 17% in 30 days and is currently trading at around $57,000, according to CoinGecko.

DigitalX Set to Launch Bitcoin Spot ETF on ASX

In Australia, DigitalX Limited, a digital asset fund manager, is set to launch its spot Bitcoin exchange-traded fund (ETF) on the Australian Securities Exchange (ASX) on July 12. ASX is Australia’s leading exchange, handling about 80% of equity trading in the country.

Developed with K2 Asset Management and 3iQ, DigitalX’s new ETF will be listed under the ticker BTXX. With this new listing, DigitalX will become the second asset manager to receive approval to launch a spot Bitcoin ETF on the ASX.

Lisa Wade, CEO of DigitalX, said the new ETF will make it easier for institutional investors to access digital asset fund products. “I believe this will attract new entrants into the market and ultimately allow institutions to include Bitcoin and digital assets into strategic asset allocations,” said Wade.

Other Bitcoin ETFs in Australia

The ASX recently approved a spot Bitcoin ETF from VanEck. VanEck’s Bitcoin ETF (VBTC) went live on June 20 and attracted A$1.5 million (around $1.3 million) on its debut date.

In addition to VanEck and DigitalX, BetaShares, another leading Australian fund manager, is also working to list its Bitcoin and Ethereum ETFs on the ASX.

Conclusion

The recent inflows into Bitcoin ETFs show strong institutional interest in Bitcoin, even during periods of selling pressure. Despite price volatility, investors are buying Bitcoin ETFs, indicating confidence in Bitcoin’s long-term value. The launch of new ETFs, like DigitalX’s on the ASX, further demonstrates the growing acceptance and integration of Bitcoin into traditional investment strategies. As Bitcoin continues to attract attention from both individual and institutional investors, its role in the financial market is likely to expand.

U.S. House to Vote on Overturning Biden’s SAB 121 Veto

Introduction

The U.S. House of Representatives will vote on a resolution to overturn President Joe Biden’s veto on a bill related to crypto custody rules. This bill had aimed to cancel the Securities and Exchange Commission (SEC)’s Staff Accounting Bulletin 121 (SAB 121).

Background on SAB 121

SAB 121 is a rule from the SEC that mandates banks holding crypto assets to record these holdings as liabilities on their balance sheets. Because of this rule, many banks and other institutional providers have avoided getting involved in the crypto asset class.

Biden’s Veto and Initial House Vote

President Biden vetoed the legislation after the House initially voted against the SEC’s crypto custody guidance. In May, the House voted 228-182 to strike down SAB 121, with support from both Republicans and 21 Democrats. The Senate also voted to overturn the guidance with a 60-38 vote, again showing bipartisan support.

Scheduled Vote to Overturn the Veto

Last week, House Majority Leader Steve Scalise added the vetoed legislation to the weekly schedule. A new vote is set for Wednesday, July 10, as reported by Fox Business journalist Eleanor Terret. This vote is critical because it requires a two-thirds majority to overturn the president’s veto. This means that around 60 more votes are needed in addition to the initial 228.

Importance of Two-Thirds Majority

For the veto to be overturned, the vote must achieve a two-thirds majority in both houses. This requirement makes the task challenging, as it is a significant increase from a simple majority. However, it is not impossible. The U.S. House has achieved such a feat before with other crypto-related bills.

Previous Crypto Legislation Success

In May, the House successfully passed the Financial Innovation and Technology for the 21st Century Act (FIT21) with a 279-136 vote. This bill aimed to provide a clear regulatory framework for the crypto industry and received strong bipartisan support, with 71 Democrats voting in favor.

Challenges Ahead

Despite previous successes, experts believe achieving the two-thirds majority to overturn Biden’s SAB 121 veto is a tough challenge. The crypto industry and its supporters are keenly watching, hoping for a positive outcome on Wednesday.

Implications for the Crypto Industry

If the House vote succeeds in overturning the veto, it could have significant implications for the crypto industry. It would mean that banks and other financial institutions might start offering crypto custody services, expanding the market and possibly leading to greater adoption of crypto assets.

Conclusion

The upcoming vote in the U.S. House of Representatives to overturn President Biden’s veto on SAB 121 is a crucial event for the crypto industry. With a two-thirds majority needed, the outcome is uncertain, but the potential impact on crypto regulations and market adoption is significant. The industry will be watching closely as the vote unfolds on Wednesday.

Summary of Key Points

• U.S. House Vote: Set to overturn Biden’s SAB 121 veto.
• SAB 121: Requires banks to record crypto assets as liabilities.
• Initial Votes: House voted 228-182; Senate voted 60-38 to strike down SAB 121.
• Scheduled Vote: New vote set for Wednesday, July 10.
• Two-Thirds Majority: Needed to overturn the veto, requiring around 60 more votes.
• Previous Success: House achieved two-thirds majority for FIT21 in May.
• Challenges: Experts believe achieving the required majority is tough.
• Implications: Success could lead to banks offering crypto custody services and greater market adoption.

The crypto industry is keenly awaiting the results of the U.S. House vote on Wednesday. Whether or not the two-thirds majority is achieved will have a lasting impact on the future of crypto regulations in the United States.