July 3 2024: Bitcoin prices continued to decline on Wednesday, extending losses from earlier in the week as traders remained wary due to concerns that distributions from the defunct exchange Mt Gox could trigger mass selling.
Sentiment in broader crypto markets remained negative amid uncertainty over U.S. interest rates, with a recent dip in the dollar doing little to alleviate the sector’s weakness.
Bitcoin fell 4% in the past 24 hours to $60,339.1 by 08:20 ET (12:20 GMT). The world’s largest cryptocurrency continued to face steep losses through June, remaining firmly within a trading range established since March.
Bitcoin Sees Little Relief Amid Mt Gox Fears
Traders were on edge, anticipating distributions by Mt Gox. Liquidators of the exchange indicated they will begin returning Bitcoin stolen during a 2014 hack to clients by early July.
The exchange had mobilized about $9 billion worth of Bitcoin earlier this year, though the extent of the planned distributions remains unclear.
Speculation suggested that recipients of the tokens would likely sell, given Bitcoin’s significant price gains over the past decade. This could lead to extended selling pressure on Bitcoin.
Speculation over potential dumping by other entities also weighed on Bitcoin. The German government was seen offloading Bitcoin recovered from a piracy website, while some whales were mobilizing Bitcoin this week.
Even before Mt Gox fears began affecting Bitcoin prices, sentiment towards crypto had already cooled as the token remained rangebound for over three months. Capital flows data showed trading volumes of crypto exchange-traded funds, particularly Bitcoin, fell drastically in recent months.
Crypto Price Today: Rate Jitters Weigh on Altcoins
Broader crypto prices retreated, taking little support from an overnight decline in the dollar.
Ether, the world’s second-largest token, dipped 4.5% to $3,296.01, with sentiment remaining weak even as reports suggested a spot Ether ETF could be approved this week.
XRP, SOL, and ADA fell between 1% and 4.5%, while meme tokens DOGE and SHIB lost more than 4% each.
Cryptos saw little gains even as Federal Reserve Chair Jerome Powell flagged progress towards reducing inflation, which weighed on the dollar. However, Powell warned that the Fed still needed more confidence before starting to cut interest rates.
His comments came ahead of more key cues on U.S. interest rates. The minutes of the Fed’s June meeting are due on Wednesday, and several Fed officials are also set to speak.
Beyond the Fed, nonfarm payrolls data is due on Friday.
Bitcoin Could Hit $100K by U.S. Election Day, Says Standard Chartered
Bitcoin’s price could reach a new all-time high in August, followed by a surge to $100,000 by the U.S. presidential election in November, according to Standard Chartered analysts.
In a Tuesday note, analysts highlighted that “a fresh all-time for bitcoin in August is likely, then $100,000 by U.S. election day.”
The bank’s forecast depends on Joe Biden staying in the presidential race, a scenario perceived by the market as favoring a Donald Trump victory. Analysts consider Trump to be “bitcoin-positive” and highlighted a positive correlation between Trump’s electoral odds and the price of bitcoin. “The logic here is that both regulation and mining would be looked at more favorably under Trump,” they wrote.
Standard Chartered also modeled a “least likely” scenario where Biden exits the presidential race in late July, which could lead to bitcoin prices falling to $50,000-$55,000.
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