Bitcoin, the world’s largest digital asset, has crashed significantly in the last 24 hours, as it dropped below the $58,000 level. This significant decline extends the digital asset’s loss to approximately 5%. Notably, this price level was last recorded at the beginning of May.
Key Factors Behind BTC Price Drop
As per CoinMarketCap data, Bitcoin crashed below $58,000 in early European morning hours to a low of $56,773.02.
![Bitcoin 1D Price Chart](https://crypto-vanguard.com/wp-content/uploads/2024/07/BTC_1D_graph_coinmarketcap-6.jpeg)
Market watchers are attributing the steep decline to activity from wallets associated with the crypto exchange Mt. Gox. Additionally, the German Federal Criminal Police Office made a substantial transfer, complicating the selloffs.
The decision of the German government to move over $50 million in Bitcoin to crypto exchanges triggered sell speculation in the broader market. This trend was spotted by Lucy Hu, Senior Analyst at crypto investment firm Metalpha, As part of the latest moves, $175 million in Bitcoin was transferred to various wallets by the German entity. Of this amount, $75 million went to crypto exchanges Kraken and Coinbase.
Meanwhile, Mt.Gox’s wallet became active as it prepares to distribute assets stolen from clients during a 2014 hack this month. The repayments, domiciled in Bitcoin and Bitcoin Cash (BCH), could exert additional selling pressure on both markets.
Notably, data from Arkham Intelligence revealed that Mt. Gox wallets conducted test transactions in Asian morning hours. The former exchange moved a total of $25 worth of Bitcoin across three different wallets. This revealed to the broader crypto ecosystem the exchange’s selling intention.
In the crypto industry, the movement of small amounts before transacting large volumes is standard practice.
Market Sentiment Around Bitcoin
Analysts say they will continue to monitor these developments as they could influence Bitcoin’s price trajectory. Despite the anticipated bullish run for the digital assets as predicted by notable figures, the market has witnessed significant outflows.
The US spot Bitcoin ETF on July 3, broke a five-day consecutive inflow streak with a net outflow of $13.62 million as the BTC selloff intensified.
Disclaimer: The information provided in this article is for informational purposes only. It does not constitute investment, financial, trading, or any other sort of advice. You should not treat any of Crypto-Vanguard’s content as such. Crypto-Vanguard does not recommend that any cryptocurrency should be bought, sold, or held by you. Do your due diligence and consult your financial advisor before making any investment decisions.