Bitcoin has fallen to a low not seen since 2 May, after a range of sell-pressure factors took their toll on the world’s largest digital asset by market capitalisation. Bitcoin (BTC-USD) traded flat over the past day to change hands for $60,871 (£48,122) on Thursday, according to CoinGecko data.
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The leading cryptocurrency by market value is down over 10% so far this month. However, it remains significantly higher when we look at its performance over the past year, having risen around 100% over the past 12 months. Despite this, it is still down over 17% from its record high of $73,798 in mid-March.
Other crypto tokens, such as ether (ETH-USD) and solana (SOL-USD), have decreased by 0.6% and 0.2% respectively in the past 24 hours, according to Coingecko data.
The digital asset has also failed to correlate with equity indices, which have remained buoyant this week. The S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) closed higher at the end of trading on Wednesday.
Bitcoin is beset by multiple sell-pressure factors
Over the past week, several factors have emerged that have increased selling pressure on bitcoin. Notably, the Mt. Gox trustee announced that creditors of the defunct exchange will begin receiving repayments totalling approximately 142,000 bitcoin, worth nearly $9 bn, starting in July.
Read more: Bitcoin price dips ahead of FTX and Mt Gox bankruptcy payouts
Investors remain cautious about the possibility that Mt. Gox creditors could start dumping their newly redistributed bitcoin onto exchanges after waiting over a decade to receive them.
US and German governments send seized bitcoin to exchanges
Another point of selling pressure has emerged, as according to data from Arkham Intelligence, the US government recently sent 3,940 bitcoin to the Coinbase cryptocurrency exchange. The data indicated that the bitcoin was seized earlier in 2024 from Banmeet Singh, a convicted drug dealer.
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As part of the judgment against Singh in January, he was forced to surrender more than 8,100 bitcoin to US authorities. The US Drug Enforcement Agency characterised the bitcoin haul as the largest cryptocurrency seizure ever conducted by the agency.
Also, on Tuesday, an analysis by Arkham Intelligence showed that the German government recently transferred $24m in seized bitcoin to the Kraken and Coinbase cryptocurrency exchanges.
These bitcoin transfers originated from a wallet connected to the German Federal Criminal Police Office (BKA) and could be linked to the BKA’s 2013 seizure of nearly 50,000 bitcoin from a film piracy website.
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Arkham Intelligence data indicates that these transfers follow previous movements of $195m in bitcoin to exchanges last week. In total, over $425m has been shifted in the past week by the BKA-associated wallet.
The transfers to exchanges may signal an intent to liquidate some of the assets, potentially adding further downside pressure on the digital asset.
Spot bitcoin ETF demand picks up
In contrast to the multiple factors contributing to selling pressure, institutional investor demand for US-based spot bitcoin exchange-traded funds (ETFs) is starting to increase after a period of declining interest.
On Wednesday, spot bitcoin ETFs posted net inflows of $21.52m, continuing a positive trend that began on Tuesday.
Read more: What is a spot bitcoin ETF and why has it sparked a crypto rally?
The largest net inflows from spot bitcoin ETF products on Wednesday came from Fidelity’s FBTC, which saw $19m, according to data from SoSoValue. Grayscale’s GBTC exchange-traded fund saw net inflows of $4m, its first positive flow since June 5. VanEck also recorded $3m in inflows on the same day.
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