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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.