Market Turmoil: Bitcoin Dips Below $54,000, Ethereum at $2,800, and Miner Capitulation
“Should Have Sold” — a special edition of the ForkLog news podcast covering the week’s main industry events and the hottest tokens.
Topics: market crash, unprofitable mining, Mt.Gox coin movements, and a “light at the end of the tunnel” for Bitcoin.
Participants: ForkLog authors Alex K., Vasily Smirnov, and AI section editor Vladimir Sleeper.
Market Bloodbath
On the morning of July 5, the price of the leading cryptocurrency plummeted below $54,000 amid reports of Mt.Gox coin movements.
Arkham experts noted the transfer of 47,228.7 BTC (~$2.71 billion) from the exchange’s cold storage to a new address. On the same day, on-chain researchers recorded a transfer of 1,545 BTC (~$84.9 million) from one of Mt.Gox’s cold wallets to the Bitbank trading platform.
Despite the fact that the total volume of moved Mt.Gox bitcoins represents about 0.24% of the total coin supply, the market reacted nervously. For instance, the fear and greed index dropped to 29, and the prices of most altcoins fell by 10% or more.
Miner Capitulation
Prior to the July 5 crash, CryptoQuant analysts noted that Bitcoin miners began shutting down inefficient equipment and selling reserves.
Experts pointed out that such periods of capitulation are historically associated with price lows.
Under such unfavorable market conditions, only a few of the most advanced Bitcoin mining devices can operate profitably.
The network’s hash rate, following the block reward halving in April, decreased by 7.7%. This is the largest drop in the metric since December 2022, when the market bottom was recorded after the FTX collapse.
Following the latest difficulty adjustment, it decreased by 5%.
Light at the End of the Tunnel
Analysts at QCP Capital believe that Bitcoin’s rally could resume by the end of the year. According to their observations, the options market is poised for growth, despite the recent price correction of leading cryptocurrencies.
“This is confirmed by significant interest in long-term options with a strike of $100,000-120,000,” the experts added.
However, they predict that cryptocurrencies will behave “meekly” in the third quarter, partly due to uncertainty surrounding the Mt.Gox factor.
When Will Solana ETF Launch?
VanEck’s Head of Digital Asset Research, Matthew Sigel, expressed the view that the chances of launching a spot ETF based on Solana largely depend on the outcome of the upcoming U.S. presidential elections and whether Gary Gensler remains at the helm of the SEC.
“There is a good chance that crypto voters will play a decisive role in these elections,” Sigel stated.
The top manager emphasized that if the SEC approves Ethereum-ETF trading, it will confirm Ether’s status as an exchange-traded commodity.
“The same will be true for Solana,” Sigel drew a parallel.
Now, he says, “small changes in Washington” are needed.
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