July 8 2024: Bitcoin’s price dipped slightly on Monday amid ongoing concerns over distributions by the now-defunct crypto exchange Mt Gox, negatively impacting sentiment in the broader cryptocurrency market.
Despite these challenges, the world’s largest cryptocurrency found some support around the $57,000 level after hitting over four-month lows earlier in the day. Bitcoin fell 0.8% in the past 24 hours to $57,072.0 by 08:09 ET.
Bitcoin Impacted by Mt Gox Distributions Trustees of the defunct Mt Gox crypto exchange announced they had begun distributing tokens to clients affected by a 2014 hack. While the value of the distributions has not been specified, wallets linked to the exchange moved approximately $9 billion worth of Bitcoin earlier this year.
Traders sold off Bitcoin fearing that recipients of the tokens will likely sell their holdings due to Bitcoin’s substantial price increase over the past decade. This scenario presents significant selling pressure on the token.
Several major Bitcoin wallets, often referred to as “whale” wallets, were activated for potential sales, and inflows into crypto investment products have significantly dried up over the past few weeks.
Altcoins Show Mixed Performance Amid Bitcoin’s Decline Despite Bitcoin’s drop, major altcoins had mixed performances. Ether, the second-largest cryptocurrency, climbed 1% to $3,043.14, after briefly dropping below $3,000 for the first time since May. ADA/USD and XRP rose 2.5% and 0.7%, respectively, while Solana fell 0.4%. Among meme tokens, DOGE/USD dropped 1.8%, while the Investing.com Shiba Inu Index added 0.8%.
Selling pressure on Bitcoin affected major altcoins, as Bitcoin typically acts as a barometer for the entire crypto industry.
Crypto prices largely ignored recent dollar weakness amid growing optimism over potential interest rate cuts by the Federal Reserve. This trend saw Wall Street hit record highs.
A testimony by Fed Chair Jerome Powell this week is expected to provide more clues on interest rates, alongside key U.S. consumer price index inflation data.
Digital Asset Investment Funds See Inflows After Weeks of Outflows Digital asset investment products saw net inflows of $441 million last week, breaking a three-week streak of net outflows, according to a new report by CoinShares. The last time these products recorded net inflows was the week ending June 7, when investors added over $2 billion.
Bitcoin accounted for $398 million of the inflows. CoinShares noted that it is unusual for Bitcoin to represent only 90% of the total inflows. Among altcoins, Solana stood out, with SOL-linked products attracting $16 million.
CoinShares attributed the inflows to recent price weakness, driven by the Mt. Gox distributions and the German government’s law enforcement agency moving large amounts of Bitcoin to exchanges.
Investors likely viewed this as a buying opportunity, although positive sentiment did not extend to blockchain equities, which experienced $8 million in outflows, bringing their year-to-date total to $556 million.
