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Bitcoin Drops to $62K, But Derivatives Signal Bullish Trend

Bitcoin’s price dropped to $62,498, but BTC options markets indicate traders are still bullish at this level.

• Main Points:

  • Price drop: Bitcoin fell 5.5% to $62,498.

  • Market reaction: Derivatives markets show resilience.

  • Investor sentiment: Fear of further price corrections is minimal.

  • Economic factors: Stable interest rates and global tensions impact markets.

• Detailed Insights:

  • Price drop: Between July 31 and August 1, Bitcoin’s price plunged 5.5%, reaching its lowest level in over two weeks. This decline is attributed to lower expectations for U.S. interest rate cuts and the distribution of 47,000 BTC from Mt. Gox.

  • Market reaction: Despite the price drop, Bitcoin derivatives markets show resilience. The Bitcoin futures premium, which reflects the price difference between futures and spot markets, declined to 7% but remained within a neutral range. This indicates that investors have not turned bearish, though their optimism has slightly decreased.

  • Investor sentiment: Analysis of the Bitcoin options market, specifically the 25% delta skew, shows a neutral market with a slight tilt toward bullish sentiment. The delta skew stands at -5%, suggesting balanced demand for call and put options, and has remained stable despite the price decline.

  • Economic factors: The U.S. Federal Reserve kept interest rates unchanged at 5.25%, aligning with market expectations. Fed Chair Jerome Powell highlighted economic growth and inflation reduction, hinting at a potential rate cut in September. Rising geopolitical tensions and cautious economic indicators have also led investors to seek safer assets like U.S. Treasurys and gold.

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

While Bitcoin's price has experienced a significant drop, derivatives markets suggest that professional traders do not anticipate further major corrections, indicating a cautiously bullish outlook.

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Kiyosaki: Save Bitcoin as Smart Money, Citing Trump's Endorsement

Robert Kiyosaki, author of Rich Dad Poor Dad, advocates for saving Bitcoin over fiat currencies, citing their value as "fake money." He supports former President Donald Trump's endorsement of Bitcoin and predicts an economic shift favoring Bitcoin, gold, and silver.

• Main Points:

  • Bitcoin endorsement: Kiyosaki encourages saving Bitcoin, gold, and silver.

  • Critique of fiat: Labels fiat money as "fake" and warns against it.

  • Trump's support: Highlights Trump's positive stance on Bitcoin.

  • Economic predictions: Foresees significant gains for Bitcoin, gold, and silver.

• Detailed Insights:

  • Bitcoin endorsement: Robert Kiyosaki, renowned author of Rich Dad Poor Dad, urged investors on social media to save Bitcoin instead of fiat currencies. He emphasized Bitcoin, gold, and silver as "smart money" options.

  • Critique of fiat: Kiyosaki criticized the decision to remove the dollar from the gold standard in 1971 and condemned the education system for failing to teach financial literacy. He called fiat money "counterfeit" and "fake," advising people to stop working for and saving it.

  • Trump's support: Kiyosaki noted former President Donald Trump’s recent endorsement of Bitcoin at the Bitcoin Conference. He praised Trump as financially brilliant and echoed his support for Bitcoin and silver.

  • Economic predictions: Kiyosaki predicted a major economic shift, forecasting Bitcoin could reach $10 million per coin, gold $15,000 an ounce, and silver $110 an ounce. He attributed this to declining trust in fiat currencies and historical trends. He urged investors to abandon the U.S. dollar and invest in Bitcoin before its price surges.

Related: Kiyosaki Predicts $105K Bitcoin and $3.3K Gold if Trump Wins

Kiyosaki's strong advocacy for Bitcoin and other precious metals reflects his belief in their long-term value and potential as safeguards against economic instability.

MicroStrategy Continues to Grow Bitcoin Holdings

MicroStrategy continues to expand its Bitcoin holdings, now totaling 226,500 BTC. Despite facing significant quarterly losses due to accounting rules, the company remains steadfast in its Bitcoin strategy.

• Main Points:

  • Increased holdings: MicroStrategy now holds 226,500 BTC.

  • Recent purchase: Acquired 169 BTC for $11.4 million in July.

  • Market value: Holdings valued at over $14.5 billion.

  • Strategic success: Stock up 1,206% since adopting Bitcoin strategy.

  • Financial impact: Reported $102.6 million loss due to impairment charges.

• Detailed Insights:

  • Increased holdings: MicroStrategy, the Virginia-based business intelligence firm, has increased its Bitcoin holdings to 226,500 BTC. CEO Michael Saylor announced the acquisition of an additional 169 BTC for $11.4 million in July.

  • Market value: According to Bitcoin Treasuries, MicroStrategy’s Bitcoin holdings are now valued at over $14.5 billion. The company remains the largest corporate holder of Bitcoin, with Marathon Digital, a major Bitcoin mining company, holding $1.29 billion worth of BTC in distant second place.

  • Strategic success: Saylor highlighted the success of MicroStrategy’s Bitcoin strategy, noting that since its adoption in August 2020, the company’s stock has risen by 1,206%. In comparison, the Nasdaq 100 has only increased by 60% over the same period.

  • Financial impact: Despite the impressive stock performance, MicroStrategy reported a loss of $102.6 million in the second quarter due to cryptocurrency-related impairment charges. This follows a net loss of $115.2 million in the previous quarter. Current accounting rules prevent the company from recognizing recent Bitcoin price gains, though a new FASB standard may soon allow the inclusion of unrealized gains in future earnings reports.

Related: Michael Saylor Predicts $13M BTC in Bullish Keynote

MicroStrategy’s commitment to its Bitcoin strategy underscores its belief in the long-term value of the cryptocurrency, despite short-term financial challenges.

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