Bitcoin Price Declines as Crypto Liquidations Exceed $330 Million

Bitcoin Price Declines as Crypto Liquidations Exceed $330 Million

For the first time since early May, the price of Bitcoin has dropped below $60,000. This follows news that next week, creditors of Mt. Gox will begin collecting repayments in Bitcoin and Bitcoin Cash.

The most popular cryptocurrency in the world had been cooling off for the entire month following an exciting start to the year with the SEC approving spot Bitcoin ETFs.

However, according to CoinGecko data, it has suffered the most today, sliding 6.2% over the previous 24 hours to a daily low of $59,962. The price of cryptocurrency exchange Coinbase has dropped even further, to just $59,780.

In 2014, a breach on the now-defunct Japanese cryptocurrency exchange Mt. Gox resulted in the loss of $63.6 million in Bitcoin, which at the time was valued at roughly $46 billion. Ten years later, Rehabilitation Trustee Nobuaki Kobayashi said in a note that starting in early July, creditors will start getting payments in Bitcoin and Bitcoin Cash.

This appears to have alarmed the market, as rumours circulated that creditors of Mt. Gox would liquidate their reclaimed coins right once. Spot on Chain reports that the three wallets held by the now-defunct company have 141,686 BTC in total, which is almost $8.71 billion. If this were to occur, the amount of capital that would exit the market would be similar to what the U.S. Bitcoin ETFs saw come in after the approval in January.

According to CoinShares data, assets worth more than $1.2 billion have moved out of U.S. Bitcoin ETFs in the last two weeks. “We think this is a response to investors’ pessimism about the Federal Reserve’s decision to cut interest rates this year,” CoinShares Head of Research James Butterfill stated in a Medium article.

According to data from CoinGlass, more than $335 million worth of cryptocurrency holdings have been liquidated during the last day, including $293 million worth of long positions, or wagers that the price of a particular asset would rise.

The majority of the losses are accounted for by Bitcoin, which has $145 million in liquidated positions. Long positions were valued at more than $134 million.

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