Bitcoin prices dropped on Thursday, falling to $58,467.0 by 01:46 ET (05:46 GMT), as anxiety over potential Mt. Gox token distributions and capital outflows from major exchanges overshadowed positive U.S. inflation data and interest rate signals.
Mt. Gox Distribution Fears Resurface
Concerns about selling pressure from Mt. Gox resurfaced this week after a wallet linked to the defunct exchange, holding $2 billion in Bitcoin, conducted test transactions. This activity has sparked fears of new token distributions by the exchange, which began returning Bitcoin stolen in a 2014 hack to clients in July.
While the exact amount of Bitcoin to be distributed remains uncertain, the potential for increased selling pressure has unsettled traders. Earlier this year, Mt. Gox was involved with approximately $9 billion in Bitcoin.
USDT Outflows Signal Potential Price Weakness
According to digital assets research firm IntoTheBlock, about $1 billion worth of the stablecoin USDT was withdrawn from crypto exchanges this week. Previous large outflows of USDT have often preceded Bitcoin price declines, suggesting that traders might be withdrawing funds in anticipation of a risk-off scenario.
Crypto Prices Lag Despite CPI Data
Overall cryptocurrency prices declined on Thursday, trailing behind broader risk-driven asset rallies. The softer-than-expected consumer price index (CPI) data did little to boost crypto prices, despite a positive effect on stock markets and other risk assets due to expectations of lower interest rates.
However, the CPI still showed a month-on-month increase, leading traders to anticipate a smaller rate cut by the Federal Reserve in September, which has constrained the extent of the risk-on rally.
World’s second-largest cryptocurrency, Ether, dropped 3.1% to $2,638.30. Similarly, SOL, XRP, and ADA each fell over 1%. Among meme tokens, DOGE declined by 3.4%.
