Fun

Bitcoin price drop and crypto market turmoil intensifies — Is Germany to blame?

News Feed - 2024-06-22 05:06:49

Marcel Pechman3 hours agoBitcoin price drop and crypto market turmoil intensifies — Is Germany to blame?Some traders say Germany’s Bitcoin selling is behind this week’s drop, but a negative reaction to concerning macroeconomic data is the likely culprit.2965 Total views75 Total sharesListen to article 0:00Market AnalysisOwn this piece of crypto historyCollect this article as NFTJoin us on social networksThe total cryptocurrency market capitalization plummeted 3.9% between June 20 and June 21, approaching its lowest level in five weeks at $2.34 trillion. This decline affected every top 10 coin, with Bitcoin (BTC) dropping 4.2%, Ether (ETH) experiencing a 4% loss, and BNB (BNB) facing a 4.2% correction. Despite some recovery of intraday losses, the market remains in a bearish mood.Total crypto market capitalization, 12-hour, USD. Source: TradingViewGermany sell pressure more than compensated by MicroStrategy’s BTC purchase


Some analysts suggested that a large sale of Bitcoin by the German government caused the crypto market downturn. However, this explanation overlooks the fact that traditional finance investors reacted to unfavorable macroeconomic data. Traders are concerned that the stock market may have peaked and that the United States fiscal situation is weakening.


According to the onchain crypto analytics firm Arkham, a wallet linked to the German government transferred 6,500 BTC to exchanges on June 19, worth $425 million at the time. Arkham claims that the wallet held nearly 50,000 BTC, believed to have been seized from the pirated movie website Movie2k, which operated in 2013. The evidence suggests that this entity sent BTC to Kraken, Bitstamp and Coinbase, leaving little doubt about its origin and effective sale.


However, this theory is flawed because the U.S.-based business intelligence firm MicroStrategy disclosed on June 20 that it had purchased an additional 11,931 BTC for $786 million. Thus, MicroStrategy’s buy covered the selling pressure, including the two-day $292 million net outflow from U.S. spot Bitcoin exchange-traded funds.


Given that no other regulatory changes or events could have negatively impacted the sentiment of cryptocurrency investors in the past couple of days, one should focus on the traditional finance industry, particularly on macroeconomic data. Despite the short-term correlation between the S&P 500 index and the crypto sector, traders typically exit risk-on positions during periods of uncertainty.U.S. futures and options expiry and worsening global macroeconomic conditions


According to Bloomberg, the U.S. stock market is facing a “triple witching,” an event that occurs every quarter when derivatives contracts tied to stock, index options, and futures are scheduled to mature. An aggregate of $5.5 trillion is set to expire on June 21, and as the S&P 500 nears its all-time high, investors fear that weaker macroeconomic data indicate a higher recession risk.


Existing home sales in the U.S. fell for the third consecutive month in May, while the manufacturing and services purchasing managers’ index (PMI) readings for France and Germany came in below expectations. Similarly, in the United Kingdom, the PMI showed that private-sector companies reported slower growth than expected. Lastly, Japan’s inflation rose to 2.8% in May, higher than April’s figure of 2.5%.


Gennadiy Goldberg, head of U.S. rates strategy at TD Securities, stated that the U.S. debt ceiling, which has been suspended by Congress until the start of 2025, is expected to create a standoff and potentially trigger another sovereign credit rating downgrade, according to Reuters. “The 5-year credit default swaps (CDS) on U.S. sovereign debt indicate some worry,” Goldberg said.


Related:Why is Bitcoin price down today?


The worsening sentiment was reinforced after retail data provider Syntun stated that China’s annual mid-year e-commerce festival saw sales drop for the first time in eight years. The event celebrates the founding date of Chinese giant JD.com, which is the region’s second-largest in terms of annual sales, according to CNBC. Gross sales reached $102.3 billion in 2024, a 7% drop compared to 2023. 


Under this scenario, the U.S. Dollar Index rose to its highest level in 50 days at 105.85, indicating that investors are moving away from the euro, British pound, Swiss franc and similar currencies. While the S&P 500 index remained unchanged on June 21, traders viewed Bitcoin"s 52% gains year-to-date in 2024 as a reason to take profits and reduce exposure amid macroeconomic uncertainty.


This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.# Bitcoin# Cryptocurrencies# Congress# Ethereum# Bitcoin Price# Economy# Germany# Markets# Stocks# MicroStrategyAdd reaction

News Feed

Ethereum Price Consolidates: Preparing for the Next Move Higher?
Este artículo también está disponible en español. Ethereum price is consolidating gains above the $2,580 resistance. ETH could gain pace if it clears the $2,650 resistanc
FTX Provides Details On $16 Billion Distribution Timeline For Customers And Creditors
Este artículo también está disponible en español. The long-awaited resolution for nearly $16 billion in fundsowed to users and customers of the defunct crypto exchange FT
Amaka Nwaokocha11 hours agoIndian government set to introduce rules against deepfake menaceIn talks with stakeholders, Minister Ashwini Vaishnaw aims to finalize the Indian government’s AI deepfake regulations in the c
Price analysis 8/12: SPX, DXY, BTC, ETH, BNB, SOL, XRP, DOGE, TON, ADA
Rakesh Upadhyay3 hours agoPrice analysis 8/12: SPX, DXY, BTC, ETH, BNB, SOL, XRP, DOGE, TON, ADAThe S&P 500 Index is extending its recovery, boosting buying in Bitcoin and select altcoins in the near term.930 Total v
Brayden Lindrea7 hours agoCrypto payment gateway CoinsPaid suspects Lazarus Group in $37M hackCoinsPaid said it is now working with Estonian law enforcement and several blockchain security firms are assisting to minimize
Finder’s Experts Predict Bitcoin Will Peak at $94K This Year
Finder"s Experts Predict Bitcoin Will Peak at $94K This Year Finder’s panel of 33 fintech specialists has forecasted that the price of bitcoin will peak at about $94K before
Softbank lost 99% when the dotcom bubble burst, now it’s all-in on AI
Tristan Greene3 hours agoSoftbank lost 99% when the dotcom bubble burst, now it’s all-in on AISoftbank Group stocks reached an all-time-high on a market capitalization of $97.2 billion.764 Total views1 Total sharesList
Cornell Professor Warns of Disruption to US Bond Market From Potential Collapse of Major Stablecoin
Cornell Professor Warns of Disruption to US Bond Market From Potential Collapse of Major Stablecoin A professor from Cornell University has warned about the potential effects a col
DEX Volume Soars But Bzx Exploit Raises Questions About ‘Decentralization Theatre’
DEX Volume Soars But Bzx Exploit Raises Questions About ‘Decentralization Theatre’ As the decentralized finance juggernaut rolls inexorably forward, the exploitation of defi
Tom Blackstone9 hours agoMultichain victims search for answers in $1.5B exploit as new evidence emergesChinese police may have busted Multichain in a money laundering investigation, but many questions remain, including i
Tristan Greene3 hours agoOxford scientists develop GPU-accelerated limit order book sim to teach AI how to tradeThe first-of-its-kind architecture gives up to a 7x speedup over traditional training methods.1940 Total vie
XRP Makes Double Rejection – Here’s Where It Might Be heading Next
Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and pu