The "Black Summer" of the crypto market has just passed, and the price of Bitcoin has rebounded but is a little weak, and the direction of market sentiment is still unclear.
Research organization Glassnode recently released a report titled " Surviving the Sell-Off ", and the data in this report shows some interesting situations. In the past month, first, the continuous outflow of ETFs led to the decline of the market, and then panic. The German government's selling of Bitcoin actually affected the price of Bitcoin more in terms of market sentiment. The selling pressure itself did not have as much impact on the price of Bitcoin as the community imagined.
So after more than ten days of continuous inflows into the ETF, what is the impact of the potential selling pressure from Mentougou on the market? What other sellers need to consider? Based on the report and combined with data from other institutions, BlockBeats sorted out the multiple selling pressure factors facing the Bitcoin market.
Selling pressure 1: Mt. Gox Bitcoin
Just last Friday, the German government sent the last 3,846 bitcoins to the trading platform, and the bitcoins in its address were completely exhausted. Bitcoin also turned to rise, but after regaining a positive attitude, there is still a "140,000 bitcoin selling pressure" in Mentougou hanging over the market.
In fact, if we look back at the sharp drop in the market over the past month, we will find that in the process of Bitcoin falling from US$71,000 to below US$54,000, the factors that contributed to the decline mainly came from profit-taking on trading platforms and outflows of ETF funds. The unexpected selling pressure from the German government was not the dominant factor.
From the report data of Glassnode, it can be seen that since June, the outflow of Bitcoin from trading platforms and ETFs has begun to increase, followed by a step-by-step drop in the price of Bitcoin by nearly 15%.
The German government's coin sales operation mainly began to affect the price in mid-to-late June, adding a layer of panic to the already downward market. The German government's coin sales and the decline in Bitcoin prices occurred simultaneously in the four days after July 1. During these four days, Bitcoin fell nearly 15%. During this process, the German government sold 15,000 bitcoins, accounting for one-third of the total 54,800 bitcoins.
On July 4, the price of Bitcoin fell below $54,000, and the transfer of more than 40,000 bitcoins remaining in the German government was monitored one by one, but the price of Bitcoin has since started to rise, and it seems that it has not been affected by the selling pressure of two-thirds of the German government's total bitcoins.
When Bitcoin tried to reach $59,000 three times on July 7, 8 and 9, the market sentiment was still extremely low. Crypto analyst Alex Krüger published an analysis and calculation on his social platform on the 9th about the decline that could be caused by the sale of Bitcoin by Mentougou and the German government. He believed that if Germany sold the remaining Bitcoin at one time and 30% of the 85,000 Bitcoins held by Mentougou were sold, Bitcoin might fall another 10.5%.
In the following days, the market rose by 7%. This shows that the impact of the German government's large-scale selling on the price of Bitcoin is not as great as the community imagines. So how much impact will the "140,000 Bitcoin selling pressure in Mentougou" that has not yet landed and is hanging over our heads have on the market?
So far, Mt.Gox has repaid assets to more than half of its creditors. According to court documents and related reports from Mt.Gox during its bankruptcy, there are about 24,000 creditors who have submitted claims. Yesterday, Mt.Gox trustee Nobuaki Kobayashi issued a notice showing that the trustee has repaid BTC and BCH to more than 13,000 creditors.
Market sentiment is neutral to negative. For example, @Trader T published a forecast on the X platform on July 13, predicting that Mt. Gox will sell more than 100,000 bitcoins before November. According to the worst-case scenario, Mt. Gox will sell 80% of the bitcoins, which may bring $4.62 billion in liquidation pressure to the market.
Cycle Capital also speculates that if the compensation from Mentougou is sold out within a month, the selling pressure faced by the market will be similar to the German government's selling, with the amount and time of selling being similar. However, after getting the assets again after more than 10 years, the market is more willing to believe that the creditors of Mentougou will sell some of the Bitcoins, but not all of them.
Cycle Capital predicts that if the compensation in Mentougou lasts longer, up to 2-3 months, the amount of Bitcoin entering the market every day will not be particularly large, and will not cause a one-time rapid decline. However, due to the continued expectation of selling pressure, the market may fluctuate for a period of time to digest the selling pressure. This also means that it is difficult for the main upward trend to come in the short term.
Selling pressure 2: Miners’ income
In terms of "historical factors", in addition to special sources of selling pressure such as the Mentougou bankruptcy and the government's seizure of funds, there is also the existence of Bitcoin miners, a regular source of selling that cannot be ignored.
According to CryptoQuant analyst joaowedson, Bitcoin miners transferred a total of about $166.2 billion worth of Bitcoin to CEX from 2023 to 2024, most of which occurred in 2024, with only $48 billion of Bitcoin withdrawn. Analysts believe that such a large transfer by Bitcoin miners is unprecedented, and miners may also become the largest sellers in the cryptocurrency market.
In this cycle, there are traces of miners selling Bitcoin. After the Bitcoin halving, miners' income has dropped sharply. In order to maintain the operation of the mine, miners are likely to sell more Bitcoin to hedge the sharp drop in income.
During the period of Bitcoin price decline in the past month, Bitcoin computing power also dropped significantly. James Check, chief analyst of Glassnode, once analyzed that "the current online hash rate is low and the block generation speed is slightly slow. This indicates that mining is difficult. This may be due to a variety of reasons, including increased operating costs, falling Bitcoin prices, or equipment problems of miners."
According to data from The Block, on June 24, Bitcoin miners’ mining revenue hit an all-time low. In more than a month, Bitcoin miners have sold more than 30,000 BTC (about $2 billion), the fastest pace in more than a year.
On July 6, CryptoQuant data showed that the average daily miner outflow reached the highest number in nearly a month and a half, indicating that miners are likely selling their Bitcoin reserves.
James once expressed his opinion at the end of June that Bitcoin miners have not yet started to "sell all" because they may be in the break-even period. So how many Bitcoins do miners have? After Bitcoin's short-term rise, what is the impact of the selling pressure from miners on the price?
Since it is impossible to monitor all the addresses of miners, the research institution Glassnode made a more optimistic statistical estimate.
Glassnode compared the "net flow of miners" monitored in the past year with the "net deposits/withdrawals of centralized exchanges" and the "net flow into ETF on-chain wallets". The results show that the balance changes of miners' addresses are about ± 500 BTC per week, while CEX and ETF-related addresses often experience large fluctuations of ± 4K BTC. Based on this, Glassnode believes that the market influence of the latter two entities may be 4 to 8 times greater than that of miners.
This number cannot be verified, but what is certain is that as ETFs continue to buy large amounts of Bitcoin, the market has realized that the pricing power of Bitcoin is indeed shifting from Bitcoin miners to traditional financial institutions behind a dozen Bitcoin spot ETFs.
So what is the recent situation of Bitcoin spot ETF?
Selling pressure three: Bitcoin profit taking
Glassnode analysis shows that Bitcoin's fall below $54,000 at the beginning of this month was already below the average inflow cost of Bitcoin holders, so the Bitcoin spot ETF Foundation chose to start entering the market.
On the other hand, ETF fund flows are also closely related to inflation data, and last week's CPI data was weaker than expected. The market believes that ETF funds may continue to flow in.
Looking back over the past two weeks, we can see that traditional financial institutions have already started the "buy the dips" process. Bitcoin spot ETFs have shown net inflows for 11 consecutive days. Matrixport's latest report also pointed out that Bitcoin spot ETFs ended a week of trading with an inflow of $310 million last Friday, setting the highest daily inflow level in more than a month.
The day before yesterday, 11 U.S. spot Bitcoin funds received a total net inflow of 6,532 Bitcoins, worth a total of approximately $422.5 million, the highest single-day net inflow since June 5, continuing the upward trend for 11 consecutive days. These funds attracted more than $1 billion in funds in three days.
The centralized trading platforms that absorb most of the liquidity in the crypto market have more holdings than spot ETF funds. Although it is difficult to speculate on the reasons for the outflow of liquidity through trading platforms, there are still some indicators that can reflect some signals.
ConsenSys researcher David Alexander II pointed out yesterday that "after a brutal week, BTC futures holdings have now increased by $570 million, up 21% from last week, and have recovered to their highest level since June 23."
After the market turned positive, the open interest of Bitcoin futures contracts increased significantly. The day before yesterday, the open interest of Bitcoin futures on the CME platform increased by 7.8% in 24 hours. As of the time of writing, the open interest of the entire network was about 510,800 BTC, worth about US$33.18 billion, an increase of 23% from the lowest point a week ago.
Yesterday, Bitcoin rose above $66,000. After a monthly decline of nearly 20%, Bitcoin rose by 17% in 5 days. The entire crypto market has seen a general rise in the past few days. It is certain that the downward trend that has lasted for a month has completely turned around. If we calculate based on Bitcoin's high price of $66,000 yesterday, it is still 10.61% away from $73,000.
The market seems to have reached a critical point again. Today, Bitcoin has fallen below $65,000 and is trading at $64,628 at the time of writing.
According to Coinglass data, based on the current mainstream CEX contract positions, if Bitcoin rebounds and breaks through $68,000, it is expected that $801 million of short orders will be liquidated; if Bitcoin falls to around $63,000, it is expected that $1.558 billion of long orders will be liquidated. According to the current price of Bitcoin, the increase and decrease of the above two positions are 5.52% and 3.52% respectively.
In an unpredictable market, being too conservative may lead to the loss of profit opportunities, while blind optimism may lead to the loss of principal in the volatility. The flag seems to be just around the corner, but it also seems to be lurking with danger. Where is the "bull market"? There is no answer yet.
