Here’s Why Bitcoin’s Price Collapsed

While it’s hard to pinpoint the source of the current selling pressure that has driven BTC from just under $67,000 to just over $61,000, there have been several events in recent weeks that may have led to “happy selling” by traders, resulting in losses of around $100 billion during this period.

🔸 Why Did Bitcoin Crash?

Around the middle of this month, the German government began depositing a large amount of BTC seized in January into several cryptocurrency exchanges, including Coinbase (NASDAQ: COIN), Kraken, and Bitstamp.

The move quickly sparked concerns among investors, as the Central European country had as many as 50,000 Bitcoins to sell — an amount that could easily cause significant price volatility.

Still, previous large-scale government sales of Bitcoin — most notably the U.S. sale of 50,000 Bitcoins seized from darknet network Silk Road — suggest that law enforcement unloading is unlikely to cause a price crash.

Nonetheless, the news in May that bankrupt cryptocurrency exchange Mt. Gox was preparing to begin redistributing assets to creditors may have further heightened concerns, and the June 24 confirmation that payments would begin in July completely ignited concerns.

Given that this includes about $9 billion worth of Bitcoin, there is a risk of creating significant selling pressure, and it is almost certain that such concerns will lead to actual selling pressure.

💬 Germany sold $3 billion, now MtGox has sold $9 billion in Bitcoin. - Charles Edwards

In addition to major moves from fairly rare BTC whales, the low trading volumes reported in early June could amplify any price movements triggered by sales.

In addition, the results of recent technical analysis (TA) conducted by several well-known cryptocurrency experts suggest that a major downtrend is imminent, which may have further spooked investors. #BTC走势分析 $BTC