Why is Bitcoin Price Falling Below $65K Again

Bitcoin has fallen back to trade below $65,000 again due to market fluctuations and actions of governments.

A transfer of 4,000 BTC, equivalent to $259.40 million from an unknown wallet to another new unknown wallet has been observed in the market.

Bitcoin Whale Activity

Whale Alert, an onchain data platform, has reported large whale activities in the market. Two transactions of 2,000 BTC each, which is equivalent to about $129.70 million per transaction, were sent from anonymous wallets to newly created anonymous wallets.

These large transactions summing up 4,000 BTC (around $259.40 million) are often considered as a signal of upcoming significant price movements and are watched by the market participants.

Similarly, the recent activity from the German government has also impacted the market. The government has put 1700 BTC (about $110.88 million) into exchanges such as Coinbase, Kraken and Bitstamp while retaining 47,179 BTC (about $3.06 billion). This movement has therefore raised concern on the possibility of large sales which may alter the market price.

BTC Derivatives Data

According to Coinglass, trading volume for Bitcoin derivatives has surged by 1.95% to $49.35 billion. This increase in trading volume suggests that more investors are engaging with Bitcoin derivatives, which are known to be traded during periods of increased market volatility.

On the other hand, open interest has declined slightly by 47% to stand at $34.16 billion. This implies a slight decrease in the total open contracts, which shows that some traders prefer to exit some of their positions instead of opening new ones.

Source: Coinglass

In addition, the volumes in the options market have reduced by 39.73%, and the total value is $625.97 million. This contraction may be attributed to a decrease in the use of options for speculative or hedging purposes, possibly owing to volatility concerns or expectations of lower future volatility. 

However, the options open interest has increased by 2.18% to stand at $10.24 billion. This increase suggests that although there are fewer new options contracts being opened, the existing ones are still being actively traded, possibly in anticipation of future price fluctuations.

Bitcoin Price Trend

Meanwhile, the bearish pressure had waned at press time, with Bitcoin price exchanging hands at $65,041. Accompanying the recovery, BTC’s market capitalization rose by 0.06% to $1,282,400,498,042, while the 24-hour trading volume fell by 2.18% to $24,801429,542.

Simultaneously, the Lookonchain data also reveals that 9 ETFs have collectively sold off 1,290 BTC which translates to a market capitalization decline of $83.7 million. This sell-off may also be contributing to the pressure on Bitcoin’s price. Furthermore, Fidelity’s Bitcoin ETF has also cut its holdings by the same measure of 1,290 BTC, thus bringing its total to 168,862 BTC worth $10.95 billion.

Read Also: German Government Just Transferred Another 200 Bitcoin To Coinbase, What Is Happening?