Government-Led Sales and Sleeping Whales Shake Up Crypto Market, BTC Drops Below $57K

Activity from long-dormant Bitcoin wallets and government-led sales has been making it difficult for Bitcoin bulls the past few days, pushing down the BTC to its lowest level since May.

Just on Friday alone, at least three notable Bitcoin wallet awakenings have occurred. A wallet inactive since 2013 transferred over 1,000 bitcoins. This was followed by two more transfers: approximately 150 BTC from a December 2013 wallet and 895 BTC from an April 2016 wallet. These movements, valued at millions of dollars, have sparked speculation about the motives behind such transfers after years of inactivity.

At the same time, sell-offs coming from the German and US governments have added to market volatility. The German Federal Criminal Police Office has been actively selling confiscated Bitcoin, transferring about $75 million worth to various exchanges. 

This is part of a larger liquidation strategy that has seen over $390 million in Bitcoin sold since mid-June. And then in an unexpected move, the German government recently transferred back 1,915 Bitcoin worth $111.5 million, further fueling market speculation.

The US has also been on a selling spree, moving BTC equivalent to hundreds of millions of dollars.

On top of all of that, the situation is further complicated by the anticipated repayments to Mt. Gox creditors, which could introduce additional supply into the market.

Bitcoin price plummeted to below $57,000 on July 7, a level not seen since early May. While it has since recovered slightly, the cryptocurrency remains down over the past 24 hours.

Despite the market turbulence, some analysts remain optimistic. CryptoQuant’s CEO, Ki Young Ju, suggests that the current market cycle differs from previous ones due to the increased participation of spot ETFs in trading volumes.

Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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