Bitcoin just crashed down to $53,000.
It looks absolutely horrible but am I panicking right now?
And the answer is no.
Why is it dumping? (Short term)
- Because of Mt. Gox fear & the German government is dumping their Bitcoin on the open market instead of the OTC.
And even the German member of parliament came out and questioned it.
Even @theRealKiyosaki came out and said that Bitcoin is going to $10 million a coin, like it or not.
So this is an opportunity.
And even if you look at liquidations, there isn't that very much of liquidations.
So if Bitcoin goes back to $70K, there's going to be $12 billion worth of shorts being liquidated.
So we are close to the bottom in the vicinity.
And do you really want to exit right here in the cycle before we go parabolic?
Longer term:
• Election & major political shift for crypto
• FTX $16b payout to customers
Feels like a massive opportunity.
Why did $BTC drop so massively?
Everyone keeps talking about Mt. Gox, Germany, ETFs, and halving
I did an in-depth analysis to uncover the full story
Here's everything I found and why you need to be careful 🧵
In just over a week, $BTC has plummeted from over $70k to below $55k
These are levels last seen in February
In this thread, I'll give a breakdown of everything that's happening and look at what the future holds for $BTC.
1. Mt. Gox
Last month, Mt. Gox, a giant exchange that was hacked in 2014, resurfaced.
The exchange announced that it would finally be repaying its creditors 142,000 BTC.
That's 0.68% of the total supply.
The general belief so far is that the creditors will be looking to sell.
Such a huge quantity will obviously have a noticeable effect on the price of BTC if sold.
This fear has now spread, causing panic selling among other holders.
2. ETFs
Spot Bitcoin ETFs put the asset largely under the influence of big investors.
Approximately 5% of the total BTC supply is controlled by these ETFs.
As such, ETF outflows, like the one we saw earlier this month, have also been exerting downward pressure on $BTC.
3. Miner Rewards
Late April this year, we had the 4th BTC halving event.
Miner rewards were slashed from 6.25 BTC to 3.125 BTC per block.
For mining to remain profitable, a BTC pump was necessary.
Since it has not happened, miners have resorted to selling to stay afloat.
4. U.S. Interest Rates
According to the recent FOMC meeting, the Fed is holding off on major rate cuts until inflation trends toward the 2% target.
Lower rates make high-risk investments like crypto more appealing.
The opposite (which is what we have now) is also true.
5. Germany
The German government is on a major BTC selling spree.
Recent Arkham data shows an additional 400 BTC was moved to Bitstamp, Coinbase, and Kraken.
In the past 2 weeks alone, the government has moved 2,700 BTC to exchanges.