- Bitcoin hits four-month low of $53,499 on Coinbase, triggering market anxiety.
- $664.5 million in cryptocurrency liquidations occur within 24 hours, highest in two months.
- Mt. Gox and German government BTC transfers contribute to increased sell pressure.=
Bitcoin reached its lowest price in four months, dropping to $53,499 on Coinbase early on July 5. The decline marked its lowest point since late February, according to TradingView. In the past 24 hours, cryptocurrency liquidations surged to $664.5 million, the highest in two months. Bitcoin has since recovered slightly to $54,300 but remains down 7.4% in the last 24 hours.
Market Reactions and Liquidations
The drop in Bitcoin’s price led to significant market reactions, affecting other major cryptocurrencies like Ether and Solana, which both experienced nearly 10% drops. Ether fell to $2,898, breaking below the key $3,000 level it had maintained since mid-May. The majority of the liquidations were long positions, with $584 million in longs and $82 million in shorts being liquidated. Bitcoin long positions accounted for $222 million, while Ether long positions saw nearly $163 million liquidated.
Contributing Factors
The decline in Bitcoin’s value was influenced by the news of Mt. Gox’s latest cold wallet transfer. On July 5, Mt. Gox moved 47,229 BTC, worth around $2.6 billion, to a new address in its first significant transaction since May. Additionally, the German government added to the sell pressure by selling 7,583 BTC worth $419.5 million since June 19. Germany still holds 42,274 BTC, valued at approximately $2.3 billion.
These developments have dampened positive sentiment towards cryptocurrencies, with the Crypto Fear and Greed Index showing a score of 29 out of 100, indicating “Fear” in the market. Analyst Markus Thielen from 10x Research predicted that Bitcoin could drop further to $50,000 due to the increasing sell pressure.
