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Impact of Mt. Gox transfers on Bitcoin and cryptocurrency markets

The recent transfer of BTC by Mt. Gox, a significant amount intended for creditor reimbursement, has coincided with a drop in Bitcoin (COIN:BTCUSD) prices, reaching its lowest level since the end of February. Following the transfer, Bitcoin’s price fell to $53,499.90, rebounding to a 1% decrease at $56,473.76 at the time of writing. BTC’s value has dropped 8.77% in a week, erasing all gains since February.

The possibility of a massive sell-off by creditors, who are set to receive around 140,000 BTC, raises fears of intense selling pressure in the market. Analysts predict that with this pressure, the price could decline to the $50,000 range in the coming weeks, highlighting Bitcoin’s sensitivity to large on-chain transactions, especially those involving liquidations by major entities like Mt. Gox.

Investor sentiment in cryptocurrencies has also worsened, with market sentiment hitting the lowest levels since the crypto winter of 2022. According to the Crypto Fear & Greed Index, developed by Alternative.me, the score reached 29, indicating “extreme fear,” a sentiment not seen since January 2023 when Bitcoin was near $17,000 after a prolonged period of decline.

The shares of cryptocurrency-related companies experienced significant drops on Friday. Coinbase Global (NASDAQ:COIN) saw its shares fall by 2.1%, MicroStrategy (NASDAQ:MSTR) faced a 1.3% reduction, and Marathon Digital Holdings (NASDAQ:MARA) and Riot Platforms (NASDAQ:RIOT) also registered declines of 5.2% and 0.9%, respectively. Additionally, Robinhood Markets’ shares (NASDAQ:HOOD) decreased by 1.9%. The instability in the cryptocurrency market directly impacts the stock market performance of these companies.

Meanwhile, Ethereum (COIN:ETHUSD) fell below the $3,000 mark, priced at $2,983.15 with a -2.4% decline. Binance Coin (COIN:BNBUSD) dropped by -2.9% to $497.66. Ripple (COIN:XRPUSD) fell by -1.94%, while Dogecoin (COIN:DOGEUSD) decreased by -0.98%. Contrarily, Solana (COIN:SOLUSD) and TonCoin (COIN:TONCOINUSD) rose by 5.9% and 2.6%, respectively.

PancakeSwap launches community reward with zkSync token airdrop

PancakeSwap (COIN:CAKEUSD), a decentralized exchange (DEX), has launched a community reward campaign running from July 5 to August 5. A total of 2,452,128 zkSync (ZK) tokens will be distributed to users who have shown continuous support since the implementation of zkSync on PancakeSwap in July 2023. The airdrop aims to reward both current and new contributors, involving veCAKE holders, liquidity providers, and other active participants. This initiative celebrates the platform’s growth, which has surpassed $3 billion in transaction volume.

Grayscale Ethereum Trust reaches parity with net asset value

The Grayscale Ethereum Trust (USOTC:ETHE), after three years of trading at a discount, reached a premium of 0.31% over its net asset value (NAV) on the eve of Independence Day. This change occurs amid expectations of Ethereum spot ETFs being launched in the US, driven by recent SEC approvals for various fund managers. The closing of the fund’s discount is seen as investor anticipation of a possible conversion to an ETF, similar to what happened with the Grayscale Bitcoin Trust.

Bitcoin Cash hash rate surge draws attention and speculation

This week, the hash rate of Bitcoin Cash (COIN:BCHUSD) reached an annual peak after an anonymous miner named “Phoenix” took over about 90% of the network’s mining in just two days. Meanwhile, the BCH token’s value fell to $324.23, a -2.1% drop in the last 24 hours, amid a general market decline and the end of Mt. Gox’s repayment plans for BCH. During the short period between July 2 and 4, the Bitcoin Cash network started at 3.6 exahashes per second (EH/s) and spiked to a peak of 9.4 EH/s, the highest rate recorded this year. After this peak, the hash rate stabilized again, returning to the weekly average of approximately 3.3 EH/s by the date of publication. This sudden increase in hash rate brought both excitement and concerns about the centralization of mining in the Bitcoin Cash network.

New era of data centers: merging bitcoin mining and AI demand

Private equity firms are beginning to invest in bitcoin miners due to the rising demand for data centers capable of supporting artificial intelligence technologies. With the increasing energy needs imposed by AI, these miners offer ready infrastructure that can be quickly adapted or expanded to meet intensive computational demands. Adam Sullivan, CEO of Core Scientific (NASDAQ:CORZ), reveals that this renewed interest is driving a wave of mergers and acquisitions in the sector, with the company recently closing a major contract to support AI operations, attracting even more attention and investment to the area.

Few bitcoin mining machines remain profitable after price drop

With the recent drop in bitcoin prices to a low of $53,499.90, only five specific ASIC (Application-Specific Integrated Circuit) models for bitcoin mining remain profitable. These models include the Antminer S21 Hydro, Antminer S21, Avalon A1466I, Antminer S19 XP Hydro, and Antminer S19 XP, with breakeven prices ranging from $39,581 to $53,187. Another model, the Whatsminer M56S++, is on the verge of profitability, while the popular Antminer S19k Pro has become unviable due to the low market price of bitcoin.

Global decline of bitcoin ATMs

In the last 40 days, the global network of Bitcoin ATMs has seen a reduction of 334 units, breaking a ten-month growth trend. This sharp decline, with 227 machines removed in just five days in July, follows the drop in Bitcoin prices. While Australia and Spain are expanding their networks, the US and Europe lead the decline, driven in part by regulations against financial crimes. Simultaneously, Bitcoin Depot, the largest US operator of these cryptocurrency ATMs, reported that its revenues, which totaled $689 million in 2023 and $647 million in 2022, do not correlate with Bitcoin price fluctuations. Despite a 155% increase in Bitcoin’s price in 2023, Bitcoin Depot’s revenue grew only 6% in the same period. The company attributes the lack of correlation to the diversified nature of its services, which go beyond cryptocurrency speculation, including international remittances and online transactions.

German MP criticizes government Bitcoin sell-off and proposes long-term strategy

German MP Joana Cotar expressed dissatisfaction with the government’s decision to quickly sell off its bitcoin holdings. She argues that instead of selling, the government should retain Bitcoin (COIN:BTCUSD) as a strategic reserve, similar to discussions in the US. Cotar contends that bitcoin can diversify and reduce risks in state assets, as well as serve as a hedge against inflation. She suggests that Germany develop a comprehensive strategy that includes holding bitcoins, issuing bitcoin-backed bonds, and creating a favorable regulatory environment.

Stricter crypto regulation in the EU

The European Banking Authority (EBA) has updated its Travel Rule guidelines to cover the cryptocurrency sector, requiring that, from December 2024, cryptocurrency exchanges in the European Union follow new rules that enhance the transparency of crypto-asset transfers. The guidelines are part of a broader EU effort to combat money laundering and terrorism financing, aiming to increase traceability and facilitate investigations. The regulations require the collection of detailed information about transfers and the involved parties.

UK court imposes financial restrictions on Craig Wright in legal dispute

The UK Supreme Court authorized a Worldwide Freezing Order (WFO) in favor of Peter McCormack against Craig Wright, resulting from a prolonged legal dispute over defamation. The decision, made by Judge Mellor, aims to prevent Wright from hiding his assets to evade paying high legal fees that McCormack incurred while defending against defamation accusations. The order sets a limit of £1.548 million, covering both the costs already awarded to McCormack and additional expenses due to Wright’s fraudulent conduct during the case.

Multicoin Capital invests in pro-crypto candidates for the US Senate

Multicoin Capital, an influential US cryptocurrency investment manager, has committed to donating up to $1 million to support Senate candidates with favorable stances toward the crypto industry. The firm plans to fund four Republican candidates through the conservative Sentinel Action Fund, conditioning the donation amount on the results of a crypto fundraising campaign.

Surprise NFT purchase by wallet from bankrupt Three Arrows Capital

A wallet associated with the bankrupt crypto hedge fund Three Arrows Capital (3AC) acquired an NFT, resulting from an offer made nearly three years ago and unnoticed by liquidators. The wallet placed a bid of 20 ETH (equivalent to $58,800) in August 2021 for the “Neon Village” NFT from the “Ninja Village” collection by artist SeerLight, which was recently accepted by the seller “@anonymoux.” The transaction occurred despite the fund being in bankruptcy, indicating a possible oversight by the liquidation administrators.