Bitcoin

With a 20% drop in a month, is it still worth buying Bitcoin?

Published

9 months ago

9 July, 2024

With a 20% drop in a month, is it still worth buying Bitcoin?

Investors are concerned about two short-term hurdles for the cryptocurrency.

Bitcoin‘s (BTC 2.65%) the price has surged nearly 50% in the first half of 2024. Three main catalysts have fueled this rally: the Securities and Exchange Commission’s approval of the first spot-priced Bitcoin exchange-traded funds (ETFs) in January; the halving in April, which cut mining rewards in half and slowed the growth of new coin supply; and investors’ hopes that the Federal Reserve would begin cutting benchmark interest rates. The rally has been aided by bullish price forecasts, such as Ark Invest’s Cathie Wood’s prediction that a single Bitcoin would be worth $1.5 million by 2030.

But over the past month, Bitcoin’s price has fallen by about 20% as it has faced two major headwinds: the long-awaited disbursement of bitcoins from the bankrupt cryptocurrency exchange Mt. Gox, and the German government’s liquidation of thousands of bitcoins seized from the movie piracy operation Movie2k. Investors should buy Bitcoin after this strong retraction?

Image source: Getty Images.

Will Mt. Gox customers quickly liquidate their recovered assets?

Years ago, Mt. Gox was one of the world’s leading cryptocurrency exchanges, but it lost around 950,000 bitcoins in a series of attacks that began in 2011. Those bitcoins were worth only around $285,000 at the beginning of 2011, but today they’re worth $53.6 billion.

The extent of these security breaches wasn’t fully revealed until 2014, when Mt. Gox abruptly shut down its exchange and filed for bankruptcy. Over the next decade, the exchange recovered 140,000 of its lost bitcoins, worth about $7.9 billion today, and this month, it finally began paying off about 20,000 of its creditors in bitcoin and bitcoin cash (an altcoin derived from the cryptocurrency).

Bitcoin was trading at just around $600 when Mt. Gox collapsed, but its price has risen more than 9,200% to around $56,000 over the past decade. So Mt. Gox creditors may be tempted to liquidate a large portion of the Bitcoin they’re finally recovering — and fear of those sales is driving its price down. But the entire $7.8 billion payout represents less than 1% of Bitcoin’s $1.1 trillion market cap, so those concerns don’t really seem to justify the 20% decline over the past month on its own.

Will the German government increase this selling pressure?

In 2013, German authorities shut down the movie piracy website Movie2k and seized nearly 50,000 bitcoins in the operation. That loot is now worth an estimated $2.8 billion.

The German government recently transferred a large portion of these coins to cryptocurrency exchanges, selling approximately 9,500 bitcoins in two large transactions. It is still holding more than 40,000 bitcoins, according to Arkham Intelligence, and investors are worried that it will liquidate even more tokens in the near future.

Justin Sun, the controversial founder of the decentralized blockchain operating system TRON, recently offered to buy most of the remaining Bitcoin holdings from the German government in a $2.3 billion off-market transaction to mitigate the impact of the sale on the market price. It’s unclear whether the German government will agree to this offer, but it does show that some large crypto investors are becoming concerned about a panic-inducing sell-off. However, a $2.3 billion sale would only amount to about 0.2% of Bitcoin’s market cap — so it seems like a lot of sound and fury that doesn’t really mean anything to long-term investors.

The dip looks like a buying opportunity

In the first half of the year, spot ETF approvals and the halving were important events that had the potential to significantly increase market demand for Bitcoin. But as we look toward the second half of the year, we see fewer short-term catalysts — so many investors are likely focusing more on short-term headwinds like Mt. Gox and the German government.

I am still optimistic I’m very cautious about Bitcoin’s future and I think its latest pullback represents a good buying opportunity for long-term investors. Its price may remain volatile, but patient investors who don’t obsess over its potential sell-off could be well rewarded in the coming decades.

Leo Sun has no position in any of the stocks mentioned. The Motley Fool holds positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.

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Bitcoin

What to watch for in the markets

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Photo: Andrew Harnik (Getty Images)

After witnessing one of the largest global IT outages on record, affecting the travel, finance and healthcare sectors worldwideThis week is set to see more political drama, events, and earnings reports from tech giants.

Donald Trump’s ‘Lovefest’ Sets Jamie Dimon Up for Consideration for Treasury Secretary Job

Let’s take a look at what awaits us:

Major companies will release their earnings reports

Major tech companies and others will release their earnings reports this week, paving the way for what the second half of 2024 will look like.

Monday

Verizon will report earnings before the start of operations.

Tuesday

Coca-Cola, Comcast and UPS are all set to report earnings before the market opens.
Tesla will report earnings in the morning, while General Motors will report earnings in the evening.
Alphabet and Visa will report results after the market closes.

Wednesday

AT&T will release its report before the market opens.
Ford and Chipotle will report earnings after the market closes.

Thursday

Earnings reports from AstraZeneca, American Airlines and Southwest Airlines will be released before the market opens.

Trump to speak at Bitcoin conference

Presumptive Republican presidential nominee Donald Trump will speak at the next Bitcoin Conference in Nashville, Tennesseewhich is scheduled for July 25-27. While this is the first time a presidential candidate will attend the conference, it has sparked a debate over whether the crypto-friendly Trump will receive support from the crypto community in the upcoming election.

In addition to Trump, independent presidential candidate Robert F. Kennedy Jr. will also discuss crypto during the conference. Crypto advocates such as ARK Investment’s Cathie Wood, MicroStrategy’s Michael Saylor, and whistleblower Edward Snowden are among some prominent names who will be participating in the conference.

Ether ETFs are on the way

New Ether Spot ETFs are set to begin trading on Tuesday, July 23. Much like the spot Bitcoin ETFs, these ETFs will allow investors to buy the second most popular cryptocurrency like stocks. BlackRock, Ark Invest/21Shares, VanEck, Grayscale, Fidelity, Bitwise, Franklin Templeton, and Invesco/Galaxy Digital are all set to offer Ether ETFs. Crypto asset manager Bitwise predict that trading in the Ether ETF will drive the price of Ether higher, potentially surpassing $5,000.

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Bitcoin

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Bitcoin miners and cryptocurrency companies that have been blocked from going public in the U.S. could ultimately be the biggest winners in the digital asset world under a second Donald Trump presidency. Foreign companies at risk of losing market share could end up being the biggest losers.

That’s the view that’s taking hold among market participants and observers in the wake of the former president’s growing embrace of cryptocurrency as his chances of election grow. survey released Thursday by CBS News showed Trump with the majority — 52 percent — of likely voters in his likely November rematch with President Joe Biden.

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Bitcoin

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Cryptocurrency investor Chris Burniske says Bitcoin (BTC), Ethereum (ETH), Solana (SUN) and the cryptocurrency market in general seem poised for a run.

Former Head of Cryptocurrency at ARK Invest account his 292,200 followers on social media platform X that several catalysts are aligning, suggesting that digital asset markets are on the verge of a bull run.

According to Burniske, a partner at venture capital firm Placeholder, the highly anticipated launch of Ethereum-based exchange-traded funds (ETFs), Republican presidential candidate Donald Trump speaking at an upcoming Bitcoin event, and the current state of the BTC, ETH, and SOL charts all suggest significant optimism for the cryptocurrency markets.

“With ETH ETFs set to go live, Trump speaking at The Bitcoin Conference, and BTC, ETH, and SOL charts looking [they do] (while stocks are weak), it’s hard to imagine a world where we don’t ship next week.”

Reuters recently reported that preliminary approval for ETH ETFs has been granted as the Bitcoin Conference is scheduled to take place from July 25-27.

BTC, ETH, and SOL are trading at $67,333, $3,528, and $174 at the time of writing, respectively.

The venture capitalist too provides an update on his prediction that the total crypto market cap will eventually hit $10 trillion. According to his chart, the path to $10 trillion is currently “23%” complete, as it sits around $2.2 trillion.

Source: Chris BurniskeX

Earlier this month, Burniske he said in an interview with Real Vision CEO Raoul Paul that he has his eye on the Move ecosystem, which was originally built by social media giant Meta and then used to develop layer 1 blockchains Sui (IUE) and Apts (APT).

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Bitcoin

Here’s the next target for BTC before bulls can hold out for $70K

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Here’s the next target for BTC before bulls can hold out for $70K

Bitcoin’s recovery is going well, and the market is seemingly poised to create a new all-time high in the near term.

Technical analysis

Per NegotiationRage

The daily chart

As the daily chart shows, the price of Bitcoin has been rising since it broke above the 200-day moving average.

The market has also reclaimed the $60K and $65K levels and is moving towards the $68K resistance zone, which could be the last hurdle before creating a new all-time high. With the RSI also indicating that the price has clear bullish momentum, it could be just a matter of time.

Source: TradingView

The 4-hour chart

Looking at the 4-hour chart, it is evident that the price has been rising rapidly since breaking the downtrend line to the upside. The market also broke the $65K resistance level with momentum, turning it into a support.

While almost everything points to a new record high in the coming weeks, there is one worrying sign. The RSI is showing a clear bearish divergence between recent price highs, which could indicate a correction or even a reversal in the near term.

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