Bitcoin
Bitcoin (BTC) Price Hits $65K Despite Mt. Gox Payment Concerns; Ripple’s XRP Leads Crypto Rally
The cryptocurrency’s recovery from last week’s low showed no signs of stopping with Bitcoin (BTC) hitting its highest price in four weeks on Tuesday.
BTC rose above the $65,000 level for the first time since late June, shrugging off a dip below $63,000 earlier in the day, as wallets linked to the holdings of now-defunct exchange Mt. Gox moved US$2.8 billion in BTClikely preparing to distribute assets to creditors in the coming days.
The rally in cryptocurrencies was broad-based, as demonstrated by the benchmark CoinDesk 20 (CD20) index, which gained nearly 3% in the past 24 hours, with 16 of the 20 components in the green for the day.
The strongest performer among major altcoins was XRP (XRP)The native token of the XRP Ledger payment network surged 9% on Tuesday and extended its weekly gains to 35%.
The token’s rally is supported by whales, or large asset holders, increasing their holdings in a sign of conviction in higher prices, crypto data provider Santiment said. pointed.
Another catalyst was traditional derivatives trading powerhouses CME and CF Benchmarks announcing indices and reference rates for XRP. Such offerings could boost institutional adoption for XRP, Brad Garlinghouse, CEO of closely related blockchain payments company Ripple, suggested.
Mt. Gox selling pressure “overestimated”
With Germany’s BTC sale delayed, cryptocurrency investors are pondering how much of the $9 billion worth of bitcoins set to be distributed to creditors will be dumped into the market to capitalize on the asset’s appreciation after a decade of waiting.
Ki Young Ju, CEO of cryptocurrency analytics firm CryptoQuant, argued that fears about selling pressure are “overrated” and will not derail the ongoing cryptocurrency rally.
“I believe this distribution will not end the bullish trend as the coins are expected to react to market sentiment in a similar way to the current supply of bitcoin,” he explained in a statement. Post X. “Unlike the German government sale, Mt. Gox creditors are not forced to sell, so it is not purely liquidity on the sell side.”
Renowned crypto and macroeconomics analyst Alex Krüger estimated a maximum 10% drop in the price of bitcoin if creditors dump their recovered assets en masse, Ju noted.
CoinMetrics also said the market should absorb Mt. Gox creditors liquidating their assets if it happens in an orderly and distributed manner over weeks, based on the current bitcoin market depth and trading volumes.
“The distribution of ~65,000 BTC (worth approximately $1.95 billion at current prices) could potentially be absorbed by the market over a period of a few weeks without causing severe disruptions, assuming liquidations are done gradually and across multiple exchanges,” analysts at CoinMetrics wrote in a report on Tuesday.
“These findings, however, are only suggestive of the depth and maturity of the BTC market, but should assuage fears of liquidity shortages in the near term.”