Bitcoin Price: US$ 54,274.19 (-6.91%)
Ethereum Price: US$ 2,419.59 (-10.02%)
According to Arkham Intelligence, a US government-controlled wallet transferred 300 ETH, worth approximately $699,000, on August 5, coinciding with Ethereum’s disappointing price action post-ETF launch and broader financial market downturns. This led to significant selling pressure, with 130,000 ETH unloaded by market makers, pushing ETH below $2,100. Meanwhile, Europe’s fourth-largest hedge fund, Capula Management, disclosed nearly $500 million investments in Bitcoin ETFs, reflecting strong institutional interest despite recent market volatility. This contrasts with Ethereum ETFs, which saw $430 million in outflows since their US launch, impacted by macroeconomic factors and significant withdrawals from Grayscale’s Ethereum Trust. Justin Sun, founder of Tron and Huobi (HTX), denied rumours of HTX’s leveraged positions being liquidated amid market turmoil and pledged $1 billion to stabilise the market. The broader market downturn has been exacerbated by the unwinding of the yen carry trade and interest rate hikes from the Bank of Japan, leading to over $1 billion in crypto market losses and significant institutional outflows.
Jump Trading’s recent transfer of hundreds of millions of dollars’ worth of Ether has stirred market speculations, with some analysts suggesting it may be part of a liquidation process due to economic pressures, while others believe it was a strategic move to convert risk assets into stablecoins. The Japanese stock market crash and subsequent yen appreciation have exacerbated fears of a global recession, impacting firms involved in the yen carry trade and leading to significant asset liquidations. Ether’s price struggles continued as it fell below $2,200, largely due to market makers selling over $290 million worth of Ether since August 3, reflecting broader market turmoil and investor panic. Meanwhile, Bitcoin ETFs saw trading volumes surge past $1 billion amid the crypto market crash, with institutional investors taking advantage of the price downturn, although the overall market environment remains volatile and uncertain. Amidst these developments, other firms like Grayscale have also been offloading substantial Ether holdings, further contributing to the market decline.
Gibraltar-based Xapo Bank has entered the UK market with a new banking service offering interest-bearing Bitcoin and fiat accounts, becoming the first licensed bank in the UK to do so, allowing customers to hold and spend Bitcoin like fiat with a debit card and other financial services, marking a significant step in digital finance integration. CoinShares reported significant outflows from cryptocurrency investment products, totalling $528 million, due to growing recession fears in the US and geopolitical concerns, with Bitcoin leading the outflows at $400 million, followed by Ether at $146.3 million, indicating investor panic and broader market turmoil. Crypto investors faced over $1 billion in liquidations as prices for major cryptocurrencies like Bitcoin and Ether plummeted, exacerbated by a global economic downturn and Japan’s stock market crash, leading to nearly 300,000 traders being liquidated and highlighting the severe impact of the market’s volatility and broader financial instability.
Crypto analysts warn that the ongoing Bitcoin sell-off could potentially drive prices below $45,000, with the possibility of dipping as low as $42,000 if the downtrend continues. Despite Bitcoin falling to a five-month low of $52,369, there remains a critical support level at $50,000, though breaking below this could lead to significant liquidations. A 10x Research report suggests that economic weaknesses in the US could impact the crypto market, possibly pushing Bitcoin prices below $50,000 and triggering broader market corrections. The ISM Manufacturing Index’s downturn indicates economic fragility, cautioning traders against opening leveraged long positions amid high volatility. Bitcoin’s dominance in the crypto market rose to 58% amid a sell-off of Ether, reflecting the asset’s central role in the market’s risk spectrum. During this downturn, hackers exploited the situation to buy discounted Ether using stolen funds from previous hacks, moving significant amounts through Tornado Cash to avoid traceability.
Source: https://cointelegraph.com
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