Bitcoin price has lost more than 5.5 percent in the last seven days. During this period, BTC hit its lowest level in six weeks at $58,400 on June 25. According to market intelligence firm Glassnode, during this sell-off BTC fell below its short-term cost base. Therefore, it faced the risk of a deeper correction. Amid these developments, the news that the US government sent 4,000 BTC to Coinbase shook the market. Analysts warn that current sales may continue.
US government address sent nearly 4,000 BTC to Coinbase
A crypto wallet known to be controlled by the US government recently transferred 3,940 Bitcoin (BTC) worth approximately $241 million to Coinbase, according to data from Arkham Intelligence. The latest transfer highlights that the US government continues to manage seized Bitcoin assets.
The wallet’s Bitcoin stash is linked to Bitcoin seized from Silk Road. cryptokoin.comAs you may have followed on , Silk Road was a notorious online marketplace for illegal drugs, weapons, and other illicit goods on the dark web that was shut down in 2013. The US government has added to Silk Road’s entire BTC stash. The US government’s current holdings in Bitcoin are worth around $13.3 billion.
Analysts warn of a deeper sell-off for Bitcoin
In its On-Chain Week Report published on June 25, Glassnode said, “Since mid-June, the spot price has fallen below the cost base of both 1w-1m holders ($68.5k) and 1m-3m holders ($66.4k), ” he writes. “If this pattern continues, it has historically led to a deterioration in investor confidence,” analysts said. “There is also a risk that this correction will be deeper and take longer to recover.” says.
Bitcoin short-term holders (STH) cost basis is a metric that represents the average purchase price of BTC for investors who are considered short-term holders. It is generally defined by the movement of coins held for less than 155 days. Data from LookIntoBitcoin reveals that BTC broke through the $64,000 level on June 23, falling below the STH Realized price of $64,591 at the time.
Additionally, the recent decline was inches away from pushing the BTC price below the cost base of 3m-6m holders at $57,300 and continues to rise even as the price drops. The report also emphasizes that the cost base of 1w-1m holders has fallen below the 1m-3m cost base, signaling “a decreasing momentum on the demand side and a net capital outflow from the asset”. In this context, analysts say, “During previous bull markets, negative capital flow structure occurred up to five times. “We can see that this structure has continued since May and early June.” says.
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