BTC surpasses previous high point in 27 months thanks to the launch of spot ETF
Ants, frightened by rumors without facts, are 'selling'... BTC price plummets
‘There are no unfounded fluctuations in the market’… Cautious investment attitude required
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Bitcoin, which started an upward trend in January with the launch of an exchange-traded fund (ETF) that used Bitcoin spot as the underlying asset, continued to break its historical high in March, raising expectations that Bitcoin's brilliant heyday will be long in coming. raised it.
Until the beginning of this month, Bitcoin recorded a price in the late 90 million won range, but it collapsed helplessly due to various negative factors that disturbed the market. The threshold of 100 million won was barely within reach, but now it has come so far down that it cannot be seen.
The head has the shape of a dragon, but the tail loses its strength, resembling a snake, and is called a 'dragon head'. If you were to summarize the Bitcoin price in the first half of this year, Yongdusami would be perfect. How did Bitcoin come to show such a rapid trend?
# Bitcoin fell helplessly due to layers of rumors
The start of the slump was a rumor about the sale of Mt. Gox, which has always been a factor in the market's uncertainty. Mt. Gox, which was once the world's largest digital asset exchange but was shut down due to hacking, officially announced on the 24th that it will begin repaying Bitcoin debt starting next month.
When Mt. Gox's plan to repay its debt was revealed, the situation in which about 141,686 bitcoins held by Mt. Gox were transferred to another wallet was highlighted last month. Rumors spread that Mt. Gox would compensate creditors with approximately 140,000 bitcoins as debt repayment and that the amount would pour into the market. Because of this rumor, Bitcoin instantly fell 4% on the 24th.
Bitcoin, which plummeted, seemed to regain stability within a day. On the 25th, thanks to the inflow of low-price purchases, it rebounded by about 2% and stabilized. There was even optimism inside and outside the market. Digital asset analysts explained, “With the current decline, the bubble is gradually disappearing from the price,” and “(Bitcoin’s decline) is over or close to the bottom.”
However, as if mocking the market's optimism, Bitcoin plummeted again on the 26th. This time, the problem was the rumor that the U.S. government would dispose of Bitcoin.
It was revealed that approximately 3,940 Bitcoins held by the U.S. government were transferred to Coinbase, the largest exchange in the United States. The fact that the U.S. government transferred Bitcoin to the exchange immediately led to a decline in Bitcoin.
The rumors continued one after another. When the U.S. government's Bitcoin exchange transfer was revealed, the German government's Bitcoin exchange transfer was also highlighted, raising market concerns.
The rumor spread so quickly that it ridiculously broke Bitcoin's rebound. Bitcoin, which failed to rebound, has continued its boring weakness, giving up its gains since the 27th.
# Rumors without facts became a factor in panic selling and market instability
Behind Bitcoin's visible decline, there is a fact that investors have overlooked. The rumor that caused Bitcoin's decline in the last week of June had no substance. We need to see that the market fluctuated due to simple psychological fear.
If you look closely at the rumors starting with Mt. Gox and continuing to the U.S. and German governments, you can find commonalities. Amidst all the rumors, there is no ‘fact’ that the entities in question actually sold Bitcoin. It is true that Mt. Gox, the US government, and the German government transferred Bitcoin, but the on-chain data on how they sold Bitcoin has not been disclosed.
Due to the psychological fear that "I will sell now that I have moved to the exchange," investors began to engage in panic selling, dumping Bitcoin, and this selling trend rapidly cooled the digital asset market atmosphere.
CryptoQuant CEO Joo Ki-young, an on-chain data analysis expert, expressed the opinion that there is no need to react sensitively to rumors. On the 27th, CEO Joo Ki-young posted on his left it
# ‘Bitcoin short-term average price’ revealed before the crash, is it really a coincidence?
At a time when Bitcoin has fallen to the $61,000 level, there is past on-chain data that investors should pay attention to. This is the average purchase price of Bitcoin for short-term investors revealed in the second week of June.
On the 10th, digital asset expert Van Straten announced that the average purchase price of 'short-term investors' who held Bitcoin within 155 days exceeded $64,000. According to on-chain data released by Straten, the average price of Bitcoin for short-term investors has continued to rise over the past 18 months, exceeding $64,000 last week.
The price of Bitcoin, which entered June at $70,000, slowly declined. On the morning of the 24th, the last week of June, the price of Bitcoin reached $64,000. When Bitcoin reached the average purchase price of short-term investors, as if they had been waiting, malicious rumors with unclear facts began to spread in the market, and short-term investors who were caught up in these rumors started selling.
In conclusion, Bitcoin's decline in the last week of June can be attributed to the panic selling of investors who were scared and threw large quantities into the market as the disclosure of the average purchase price of short-term investors served as a catalyst in a situation where unsubstantial rumors were continuously produced.
Several questions arise here. The question arises as to whether the fact that the price of Bitcoin had just reached $64,000, the average purchase price for short-term investors, right before Bitcoin's collapse, and the fact that intangible bad news poured out at the same time were a terrible coincidence.
# Where does the Bitcoin chart curve go?
From a narrative perspective, Bitcoin is full of positive elements. There is a lot of news that could cause the price of Bitcoin to rise.
Looking at the past three Bitcoin halvings, the price of Bitcoin soared to its highest level several months after the halving occurred. As the fourth halving occurred in late April, it is highly likely that Bitcoin prices will soar again in the second half of this year.
The Ethereum (ETH) spot exchange-traded fund (ETF), the leader in altcoin ETFs, is likely to be approved in early July, next week. The Ethereum spot ETF is a powerful asset that can boost not only Bitcoin but the entire digital asset (cryptocurrency) market.
The fund flow of Bitcoin spot ETFs in the United States is in a situation where more money is going out than coming in. However, considering the cumulative net inflow since the launch of the Bitcoin spot ETF in the U.S., the net outflow over the past few days has been very minimal.
In addition, Asia's first Bitcoin spot ETF market was opened in Hong Kong. A global sales competition has begun in the Bitcoin market, which has established itself as a financial product.
If we summarize the Bitcoin market price in the first half of the year again, there is no such thing as a 'dragon head'. However, it is necessary to reflect on the fact that unlike when Bitcoin broke through its previous high, which had solid facts and evidence, Bitcoin's decline was due to unfounded rumors.
There is a clear basis for the rise and fall of all asset market prices. Even if you are scared about a plummet in asset values, don't be fooled by hasty rumors. It is not too late to decide on an investment direction after properly checking the facts.
Reporter Seungwon Kwon ksw@
