The cryptocurrency market is facing serious issues as Bitcoin prices plummet from over $123,000 to less than $117,000. This comes amid unexpected inflation indicators and mass sell-offs.
Causes of Bitcoin Price Drop
The price of Bitcoin sharply declined due to new inflation data and significant transactions.
At the beginning of July, a transfer of approximately 80,000 Bitcoins was recorded, which had a significant impact on the market. This situation led to price instability and mass sell-offs.
Analysts indicate that the price drop is a result of asset consolidation observed among major holders.
Who Initiated Bitcoin Sales?
Among the large assets sold in July were approximately 80,000 Bitcoins, purchased at very low prices in 2011.
Concerns regarding mass sell-offs became a reality when major holders began transferring their Bitcoins to various wallets.
These assets were routed to Galaxy Digital and then sold on platforms like ByBit and Binance, starting with an initial batch of 16,000 Bitcoins.
Who Are the Buyers?
Galaxy Digital's distribution strategy involves sending Bitcoins to new wallets, while Fidelity is actively buying Bitcoins for their ETFs through Galaxy Digital.
These transactions suggest that investment companies like Fidelity and BlackRock have become significant buyers, potentially using Bitcoins to back their ETFs.
Out of 80,000 Bitcoins, 40,000 were transferred to various wallets, leaving another 40,000 waiting, which might signal strategic future plans.
In light of new economic realities, Bitcoin has hovered around $117,000. Given the inflation threat and anticipated market volatility, participants should exercise caution and closely monitor developments.
