Bitcoin struggled amid recent Mt. Gox repayments and market trends, but the bearish behavior shouldn’t be interpreted as unfavorable. 

Last week, Bitcoin (BTC) concluded the week at approximately $55,850, marking an 11% drop from the prior week’s closing price of $62,775. The week saw signficant selling pressure, with BTC dipping to as low as $53,500 on Thursday before rebounding to $58,250 and finally settling at $55,850.

BTC Spot ETFs recorded $238 million in net inflows during the downturn. Cumulative trading volume since inception stands at around $315 billion, showcasing a decline in trading activity. This aligns with typical market behavior, as Q3 usually witnesses lower trading activity. 

“This data should not be seen negatively but rather as a seasonal trend, especially among traditional finance investors,” noted Matteo Greco, Research Analyst at Fineqia International.

Interestingly, the decline showed no correlation with BTC Spot ETF flows, a deviation from historical patterns where ETF flows significantly influenced price movements. 

“However, for the first time since their inception, there is a noticeable decoupling between price action and capital flows, indicating that recent price behaviour has been driven mainly by trading activity within the crypto-native space,” added Greco.

Mt. Gox

The high on-chain selling pressure is partly due to the commencement of long-awaited Mt. Gox repayments. 

Founded in 2010, Mt. Gox quickly became the world’s largest Bitcoin exchange. Its success was short-lived as it abruptly halted trading, shut down its website, and filed for bankruptcy protection in early 2014, revealing the loss of approximately 850,000 BTC, worth about $450 million at the time, due to thefts from its hot wallets over several years starting as early as late 2011.

Official confirmation of repayments, marked by the movement of 47,228 BTC from a Mt. Gox-associated cold wallet, has triggered market reactions. Additionally, after a recent halving that reduced mining rewards by 50%, miners’ selling pressure continues to affect prices, though it has decreased recently.

The recent drawdown has notably reduced unrealized profits, driven by long-term holders selling their coins. The MVRV ratio now stands at around 1.5, indicating an average unrealized profit of 50% among market participants, down from over 200% in March.

“This trend suggests that recent price action was mainly due to long-term holders taking profits and selling their coins to new buyers at higher purchase prices,” Greco added.

Ethereum and other altcoins have tumbled to lows not recorded in several weeks. This bearish outlook was also recorded in Bitcoin (BTC) and other decentralized finance (DeFi) tokens. Ethereum price has taken steps back wiping out previously recorded gains this week. A major reason for the market decline is a fall in sentiments with many pointing to major market corrections. 

The total crypto market fell to $2.11 trillion, a 4.8% decline in the last 24 hours. Meanwhile, several altcoins notched wider losses today deepening the negative sentiments. The drop in the ETH price also coincides with lower on-chain numbers and a transfer of assets to centralized exchanges which signals potential sales.

Ethereum Price Nears $3K

This year, Ethereum and other crypto assets surged to new highs amid the approval of spot Bitcoin ETFs in the United States. Despite the previous price gains and institutional inflows, massive sell-offs recorded in recent times have deepened sentiments. Ethereum trades at $3,075, a 7% drop in the last 24 hours. Weekly losses pierced double digits at 11% while monthly figures topped 19% in the red zone.

These outflows have sparked similar numbers in other altcoins. ETH’s market cap tanked to $367 billion while daily trading volume is over $20 billion. This year came with projections of sustained growth above $4k but plummeting price now sees ETH moving near $3k. The drop in crypto assets might force prices lower although many holders believe a rebound might be on the cards. 

Altcoins Are Sinking

Like most commentators opine, Ethereum price can surge with positive mainstream factors. The listing of ETH ETFs can lead to a jump in the asset’s price. The recent slump has also affected altcoin prices with Solana trading below $130 and $126 and Ripple plunging over 8% in the last 24 hours. Toncoin and Cardano were also down today with larger numbers posted by meme coins.

Also Read: End of The Road for Meme Coins? Dogecoin Takes Heavy Losses 

✓ Share:

David is a finance news contributor with 4 years of experience in Blockchain Technology and Cryptocurrencies. He is interested in learning about emerging technologies and has an eye for breaking news. Staying updated with trends, David reported in several niches including regulation, partnerships, crypto assets, stocks, NFTs, etc. Away from the financial markets, David goes cycling and horse riding.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.