Bitcoin's price dipped to $66,000 early Tuesday, erasing last week's gains.
The slide came after the U.S. government moved $2 billion worth of bitcoin, raising concerns of potential selling pressure.
Solana's SOL led major losses, dropping by 6%, reversing Monday's gains, while Ether showed relative strength despite recent outflows from newly-launched spot ETH ETFs.
Bitcoin {{BTC}} inched toward the $66,000 level early Tuesday to pare all gains from last week as sentiment was dented as a significant amount of the asset was moved from U.S. government-linked wallets, instilling fears of looming selling pressure among traders.
BTC lost as much as 5%, before slightly recovering, in the past 24 hours as the U.S. Marshals Service shifted $2 billion worth of BTC to two new wallets. Tracking service Arkham estimated that at least one of these wallets was likely to be a custodial service.
Solana’s SOL led losses among majors with a 6% dump, reversing Monday gains. Token prices surged as memecoin trading heated up on the network over the weekend, with on-chain trading volumes surging over Ethereum, the usual leader.
🚨BREAKING: @solana surpasses the combined 24-hour DEX volume of the Ethereum, Base, and Binance chains.Solana's DEX volume dominance reached a new All-Time high at 42%. pic.twitter.com/RVyqKlZ8z9
— SolanaFloor (@SolanaFloor) July 29, 2024
Other majors showed similar losses amid the bitcoin decline. Cardano’s ADA lost 5%, dogecoin {{DOGE}} and BNB Chain’s BNB fell 4%, while XRP lost 3%.
Ether showed relative strength with a 1% decline, despite the newly-launched spot ETH exchange-traded funds (ETFs) seeing $97 million in net outflows on Monday, their fourth-straight day.
Analysts Warn of Losses
Market observers said macroeconomic decisions, as well as the lack of newer catalysts, could serve as market headwinds, pushing down prices in the near term.
“The market received a boost last week with anticipation of Trump’s speech at the Nashville Conference, where he was expected to mention BTC as a strategic reserve asset,” Alice Liu, research lead at CoinMarketCap, told CoinDesk in an email.
On Saturday, Republican candidate Donald Trump, during a speech at the annual Bitcoin 2024 conference in Nashville, promised to fire SEC head Gary Gensler and create a strategic Bitcoin reserve if elected.
He also said he would be a "pro-Bitcoin" president and would not allow any of the 213,239 BTC seized by authorities and held in US government wallets to be sold. According to Trump, the US will become the world's cryptocurrency capital.
However, Liu said optimism peaked on the 27th and led to a “sell the news” phase, adding that “there is no new sauce of optimism in the market now.”
Liu further cautioned that interest rate decisions from three central banks – the Bank of Japan, Federal Reserve, and the Bank of England – on Wednesday and Thursday could further increase volatility in the crypto market.
