Bitcoin fell below $50,000 at the beginning of the week. The July U.S. non-farm payrolls report (NFP) heightened recession concerns, and the Bank of Japan unexpectedly raised interest rates to the 0.25% range, causing traders to flock to yen carry trades. In the middle of the week, the Chinese government was shocked to "dump" cryptocurrencies, suppressing the rebound in cryptocurrency buying. But before the weekend, the U.S. initial jobless claims data fell more than expected, weakening the fear of recession, boosting the currency price to rebound strongly and regain the $60,000 mark.

Chinese government is shocked by news of "dumping" cryptocurrencies

On Wednesday, rumors of a Chinese “dumping” of Ethereum spread wildly in the cryptocurrency circle, causing a sharp drop in the cryptocurrency market. Lookonchain initially claimed in a now-deleted Twitter post that wallets linked to TokenPlus had begun to transfer about 789,533 Ethereum, worth nearly $2 billion at current prices.

Plus Token was a Chinese cryptocurrency wallet app that operated between 2018 and 2019 and was one of the largest cryptocurrency Ponzi schemes ever. Investigators found that its investors were defrauded of up to $2.9 billion.

Chinese police detained six people involved in the Plus Token project in Vanuatu in July 2019 and extradited them to China to face criminal charges. According to local media reports in 2020, one of the main leaders of the Plus Token project, "Zhou", will face criminal charges in China.

But it turns out that the amount of "dumping" on Wednesday may be much lower than initially stated.

Embers' follow-up investigation concluded that Lookonchain's original post was incorrect. It stated that most of the ether had been sold in 2021. He wrote in the article that "most" of the 789,500 ether referred to by Lookonchain had been sent to Bidesk, a cryptocurrency exchange based in the British Virgin Islands, between June and September 2021.

He added that they have tracked down about a dozen addresses associated with Plus Token and concluded that about 25,757 Ether worth $63.1 million were actually transferred in a single day.

Trump family: plans to launch a "crypto financial platform" to compete with traditional banks

The family of former U.S. President and Republican presidential candidate Donald Trump has just revealed that it will launch a new crypto project called World Liberty. On Thursday, Donald Trump Jr. once again released a bombshell news that it will launch a new crypto financial platform to try to solve the inequality problem of the traditional banking service system.

In a Q&A session on the subscription platform Locals, Trump Jr. denied rumors that he would launch Memecoin and stressed that he was working on developing a crypto financial platform to compete with banks. He did not provide more details about the platform, but emphasized that it would challenge the banking system.

“What we want to do is take over large parts of the banking industry, and I think there’s a lot of inequality and only certain people have access to finance, so this concept of decentralized finance is obviously very attractive to people like me who are decentralized by banks,” he continued.

He issued a similar warning in a post on Thursday, saying: “I love the crypto community’s embrace of Trump, it’s absolutely incredible, but be wary of fake tokens claiming to be Trump projects. The only official projects will be announced directly by us and will be fair to everyone.”

Putin officially signed the bill: Bitcoin and cryptocurrency mining legalized

Russian President Vladimir Putin formally signed a law on Thursday that legalizes bitcoin and cryptocurrency mining, but only for certain registered entities and individuals. The Russian government said it has allowed residents to trade cryptocurrencies, which means that the BRICS alliance has reached an important milestone in the development of digital currencies.

According to Russian state media, the new bill will only allow “registered legal entities and individual entrepreneurs” to mine cryptocurrencies. However, the bill also allows any individual who “does not exceed the energy consumption limits set by the government” to mine cryptocurrencies.

Russian residents will also be allowed to trade cryptocurrencies, but the Russian central bank reserves the right to ban any activity it deems a threat to the country’s currency, Decrypt reported, citing TASS.

The law was passed by Russia’s legislature just a week ago, along with a second bill that would legalize cryptocurrencies as an international payment method to circumvent international sanctions, which is still awaiting approval from President Vladimir Putin.

JPMorgan: Bitcoin rebound thanks to institutional investors

According to The Block, on Monday, the cryptocurrency market suffered its most severe correction since the FTX crisis, with Bitcoin prices falling by more than 15% before rebounding. JPMorgan analysts said the rebound was mainly due to institutional investors, who had limited or no de-risking of Bitcoin futures despite the overall market turmoil.

JPMorgan Chase & Co.'s futures positioning indicator suggests these investors have a bullish outlook, analysts at the bank wrote in a note Wednesday. They said the higher premium of bitcoin futures to spot prices suggests confidence among futures investors.

Analysts believe that there are many reasons for institutional investors to remain optimistic. Last week, Morgan Stanley allowed its wealth advisors to recommend spot Bitcoin exchange-traded funds to some clients. In addition, analysts said that the large-scale liquidations of the bankruptcy of former crypto exchanges Mt.Gox and Genesis may be in the past, and the cash payment of FTX's bankruptcy later this year may stimulate demand in the cryptocurrency market.

Furthermore, they added that both major U.S. political parties have expressed support for favorable cryptocurrency regulation. However, the analysts noted that these positive catalysts have largely been factored in by the market.

Analysts also pointed out that this round of Bitcoin's sharp decline was not caused by specific problems in cryptocurrencies, but by the pullback of traditional risk assets such as stocks. Although institutional investors helped support Bitcoin's rebound, retail investors also contributed to Bitcoin's decline.

In addition, momentum traders such as commodity trading advisors also played a role, exiting long positions and establishing short positions.

Overall, despite the recent correction, JPMorgan analysts remain cautious on the cryptocurrency market. Given that the above positive catalysts are largely factored in and there is limited risk reduction in the CME Bitcoin futures space, coupled with continued fragility in the stock market, analysts recommend maintaining a cautious outlook.

Bitcoin Technical Analysis

FXEmpire analyst Bob Mason said Bitcoin is above the 200-day EMA but still below the 50-day EMA, sending a short-term bearish but long-term bullish price signal.

Bitcoin’s breakout above the 50-day moving average could signal a move towards the $64,000 resistance level. Additionally, a breakout above the $64,000 resistance level could allow the bulls to launch an attack at the $69,000 resistance level.

On the other hand, a break below the $60,365 support could signal a drop to the 200-day EMA. With the 14-day RSI reading at 48.61, Bitcoin could drop to around $55,000 before entering the oversold zone.