On Thursday (August 15), Bitcoin fell below $58,500. Former US President and Republican presidential candidate Donald Trump's chances of winning the November election fell to 45%. Vice President and Democratic presidential candidate Kamala Harris's camp said that if they win, they will pass a bipartisan encryption bill by the end of this year, stimulating their chances of winning to 53%. However, given that the US government wallet transferred 10,000 bitcoins to the exchange, panic selling sentiment was triggered.
On-chain data shows that the address that received 10,000 Bitcoins from the US government wallet two weeks ago transferred the entire reserve to the Coinbase Prime deposit wallet on Wednesday. The Bitcoin transferred in the transaction was cryptocurrency seized from the now-defunct darknet market Silk Road. The amount is equivalent to more than $592 million and was transferred to the Coinbase Prime hot wallet.
On April 2, the U.S. government transferred 31,800 bitcoins to another wallet and has distributed the money to different addresses since then. It is worth noting that according to the on-chain data platform Arkham Intelligence, the U.S. government still holds more than $1 billion in Silk Road-related bitcoins.
At the same time, on-chain analysis provider CryptoQuant released an analysis report, revealing that there is a correlation between Bitcoin price movements and the fund behavior of the German ETC Group Physical Bitcoin (BTCE). Bitcoin prices tend to rise when reserves increase and fall when reserves decrease.
The decline in Bitcoin comes as the U.S. Consumer Price Index (CPI) inflation data for July showed that the CPI rose 2.9% year-on-year, lower than expected, the lowest level since 2021. The decline in inflation increases the possibility of a rate cut by the Federal Reserve in September. Therefore, some investors expect digital asset prices to rise in the coming weeks, as the prices of risky assets such as cryptocurrencies usually strengthen in a lower interest rate environment.
According to CoinTelegraph, U.S. Senate Majority Leader and Democratic Senator Chuck Schumer said that if Kamala Harris is elected president, his goal is to pass bipartisan pro-cryptocurrency legislation by the end of this year.
“We can’t continue to sit on the sidelines while we risk sending cryptocurrency overseas to countries with minimal standards that don’t have regulation at all,” Schumer said during a speech at the Crypto4Harris town hall meeting.
Noting the growth of the crypto industry, he said a Harris administration is not necessarily opposed to cryptocurrencies in principle, adding that if Harris is elected president, he would aim to pass pro-crypto legislation in the U.S. by the end of the year.
“I want to bring members of both parties in the Senate together and create momentum so that we can pass sensible legislation that helps the United States maintain its position as the most innovative country in the world,” he said. “When it comes to artificial intelligence (AI) or encryption technology, innovation is our North Star.”
He noted that lawmakers need to provide guardrails to protect users of the technology, maintain national security, and ensure encryption can't be abused by nefarious actors. He added: "Congress has a responsibility to provide common-sense and sensible regulation for cryptocurrencies, and we need your support to ensure any proposal is bipartisan."
He called on voters and cryptocurrency enthusiasts to pledge their support for Harris' campaign.
According to data from Polymarket, a large cryptocurrency betting platform, Trump's chances of winning were originally 72% in November, but now have fallen to 45% as of Thursday's Asian session, while Harris has surpassed the former with 53%.
Bitcoin Technical Analysis
NewsBTC stated that the price of Bitcoin failed to break through the $61,500 resistance zone. Bitcoin formed a short-term top and began to fall below the $60,500 level and further below the $60,000 and $59,000 levels.
Bitcoin retested the $58,000 support area and a low was formed at $58,061 and the price is currently consolidating losses.
Bitcoin price is currently trading below $60,000 and the 100 hourly simple moving average. On the upside, the price could move towards $58,800.
It is facing resistance near the 23.6% Fibonacci retracement level of the downward move from the $61,438 high to $58,061 low.
The first key resistance is near $59,500, which is the 50% Fibonacci retracement level of the downward move from the $61,438 high to $58,061 low. A clear break above the $59,500 resistance level could drive the price higher in the coming sessions. The next key resistance could be $60,000.
Next, the main resistance is $61,500. A close above the $61,500 resistance is likely to spark more gains. In such a case, the price is likely to rise and test the $63,500 resistance.
If bitcoin fails to break out of the $58,800 resistance zone, it is likely to continue falling. The immediate support on the downside is near $58,000.
The first major support is at $57,650 and the next support is currently near the $56,500 area. If the price declines further, it could drop to the $55,500 support area or even $55,000 in the near term.
