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Bitcoin Drops to $60K: What's Causing the Sell-Off?

Bitcoin's price fell over 4% to $60,000 as Genesis Global began $4 billion in crypto and cash repayments, affecting market dynamics.

• Main Points:

  • Price drop: Bitcoin falls from $65,000 to $60,000.

  • Genesis repayments: $4 billion distributed to creditors.

  • ETF outflows: $237 million net outflow from Bitcoin spot ETFs.

  • Market impact: BTC was down 10% in seven days.

• Detailed Insights:

  • Price drop: Bitcoin’s price plunged over 4%, dropping from $65,000 to $60,000. This decline is attributed to increased selling pressure as Genesis Global completed its restructuring.

  • Genesis repayments: Genesis Global announced it has begun distributing $4 billion in crypto and cash to creditors. Bitcoin creditors will receive 51.28% recoveries, while Ether creditors will get 65.87%. Solana creditors will receive 29.58%, and other altcoin creditors will average 87.65%.

  • ETF outflows: Bitcoin spot ETFs recorded a total net outflow of $237 million on August 2. Major outflows included $104 million from Fidelity’s FBTC and $45.94 million from Grayscale’s GBTC. However, BlackRock’s IBIT saw an inflow of $42.81 million.

  • Market impact: Bitcoin’s price has tumbled nearly 10% over the past seven days. Despite reaching a high of $69K earlier in the week, it fell to $60K, reflecting overall market volatility. Currently, Bitcoin is trading at $61,639, up 45% year-to-date, with a 24-hour trading volume increase of 17% to $44.7 billion.

Related: Bitcoin Set for 'Explosive Move' as Bollinger Bands Tighten

Bitcoin's recent price movements reflect significant market shifts, including the effects of Genesis Global's repayments and substantial outflows from Bitcoin ETFs.

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Bitcoin Whale Activity Hits 9-Year High, Analysts Predict Bottom

Bitcoin whales have moved the largest amount of BTC from exchanges in nine years, signaling a potential price bottom as accumulation continues.

• Main Points:

  • Whale activity: Significant BTC moved off exchanges.

  • Accumulation: Whales adding 100,000 BTC weekly.

  • Price bottom: Analysts see a potential bottom at $63,000.

  • Market outlook: Rangebound until September.

• Detailed Insights:

  • Whale activity: Bitcoin whales, or addresses with over 1,000 BTC, have moved 84,000 BTC off exchanges in July, marking the highest exchange outflow since 2015. This spike in whale net position change indicates significant accumulation despite the market’s sluggish momentum.

  • Accumulation: Whales have been adding an average of over 100,000 BTC per week and according to CryptoQuant CEO Ki Young Ju, whale wallets, including spot ETFs and custodial wallets, added 1.45 million BTC this year, totaling 1.8 million BTC.

  • Price bottom: Analysts suggest that Bitcoin’s price may have formed a new local bottom above $63,000. Crypto analyst Elja believes this level has acted as strong support, indicating a potential bottom formation.

  • Market outlook: Despite Bitcoin being rejected from the $70,000 resistance, analysts like Titan of Crypto and Rekt Capital see a positive outlook. Titan of Crypto noted that Bitcoin closed above the key macro level of $61,600, and Rekt Capital suggests a breakout could occur in September, with support levels to watch around $63,000 and $57,000.

Related: Bitcoin Whales Launch Unprecedented $23B July Buying Spree

Bitcoin's significant whale activity and accumulation patterns suggest a bullish outlook, with analysts predicting a potential price bottom and an interesting market ahead.

El Salvador's Chivo Wallet Lacks Financial Transparency

Chivo Wallet, El Salvador's official Bitcoin wallet, has not disclosed its financial balances to the National Registry Center (CNR) since its inception, raising concerns about transparency and financial management.

• Main Points:

  • Lack of disclosure: Chivo Wallet has not filed financial statements.

  • Investigative findings: Journalists highlight transparency issues.

  • Legal context: Chivo operates privately but must file with CNR.

  • Broader concerns: Implications for other government projects.

• Detailed Insights:

  • Lack of disclosure: Chivo Wallet, created by the Salvadoran government to facilitate Bitcoin transactions, has not presented any financial balances since its launch in August 2021. This failure to disclose financial standings has persisted for three years.

  • Investigative findings: Salvadoran investigative journalist Moises Alvarado reported that Chivo Wallet, despite being publicly funded and privately operated, has not filed its required yearly financial statements. This lack of transparency raises questions about the wallet’s operations and financial health.

  • Legal context: While Chivo Wallet is not a public company and citizens cannot legally demand its financial details, it is still required to file annual financial standings with the National Registry Center (CNR). The failure to do so violates standard business practices and legal requirements for private companies in El Salvador.

  • Broader concerns: The transparency issues surrounding Chivo Wallet have broader implications for other government initiatives, such as the upcoming "volcano bonds." This situation also highlights concerns about how financial disclosures will be handled for other Bitcoin-related projects.

Related: Russian Diplomat: El Salvador Wants Crypto for Trade

Additionally, Cristosal, a nonprofit human rights organization, has taken legal action against the government for the lack of transparency in its Bitcoin endeavors. This includes a lawsuit related to identity theft involving over 200 Salvadorans who registered their data with Chivo. The wallet has also been linked to a personal data leak affecting over 5 million Salvadorans, though it denies any security breaches.

The ongoing lack of financial transparency with Chivo Wallet raises significant concerns about the management and accountability of El Salvador’s Bitcoin initiatives.

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This article is not financial advice. Market conditions can change rapidly, and past performance does not guarantee future results