Today, July 15, has seen about a 5% intraday increase in Bitcoin, taking the cryptocurrency from around $59,000 to over $63,000, continuing its upward trajectory from its five-month low.
This recovery is driven by numerous significant factors highlighted by the mainstream media, including the German government’s liquidation of its 70,000 (over $3.5 Billion) BTC holdings, a weaker US currency amid a mounting deficit, and institutional traders’ rumoured acquisition of BTC.
Germany’s Bitcoin Sell-Off: 99.99% of 50,000 BTC Liquidated
The German authorities launched a campaign to liquidate hundreds of millions of dollars worth of Bitcoin (BTC) seized from Movie2k.to, a movie pirate website operator. In January 2024, authorities in the eastern German state of Saxony revealed that about 50,000 Bitcoins ($2.2 billion at the time) had been confiscated.
On July 12th, the last 3,094 bitcoins from the wallet known as “German Goverment (BKA),” valued at about $180 million, were liquidated. The wallet began dumping bitcoin on June 19th, transferring approximately 6,500 BTC in a single day. The wallet’s balance, which peaked at $3.6 billion in March, is presently at $401.
Dollar Falls to Its Lowest Level in Over a Month
Bitcoin’s price increase could have additionally recently corresponded with a depressing trend on the US dollar Index (DXY) chart.
Remarkably, DXY, a measure of the strength of the dollar relative to a basket of leading international currencies, fell by over 1% in the last one week, hitting below 104.1 on July 15; its lowest level in around five weeks. The increase in bond traders’ bets on a September interest rate drop led to this decline.
When a currency is cheaper, investors usually look for returns in riskier assets like stocks and cryptocurrencies. That could account for Bitcoin’s recent surge in value despite growing concerns about the German government’s Bitcoin dump and the ongoing return of more than 140,000 BTC to Mt. Gox customers.
Bitcoin Investors Amass Roughly $2.5 Billion worth of BTC
In contrast, Bitcoin institutional investors were “buying the dip” as BTC price action hovered at multi-month lows, according to research. In one of its Quicktake blog post on July 11, on-chain analytics company CryptoQuant showed $100,000 in fresh Bitcoin purchases in only one week.
Amazingly, Bitcoin institutional investors are not only buying, but doing so with more conviction than when BTC/USD traded near all-time highs.
“While many novice investors capitulated last week, with special emphasis on coins purchased between 1 and 3 months ago, institutional players made the largest accumulation process since March,” Oliveira stated.
Final Words
From a technical perspective, Bitcoin’s ongoing price rebound may appear to be part of an oversold bounce. Could this be the beginning of a new run in a profitable direction? Well we have to find out.
Trading cryptocurrencies may be very risky hence, this article does not constitute financial advice in any way. Trade cautiously.
