Markets
Cryptocurrency markets are volatile ahead of upcoming spot ETF approval
Bitcoin is absorbing heavy selling from the German government, while Golem appears to have sold off nine figures worth of ETH.
Cryptocurrency markets rebounded on Monday after a sharp sell-off late Sunday.
Bitcoin (BTC) recovered its losses from Sunday after falling 7% on July 7. The rebound suggests a double bottom formation near the $54,000 support, with BTC jumping 3.7% from $55,640 to $57,850 in less than an hour, while $65 million worth of short positions were liquidated.
BTC/USD Hourly Chart. Source: TradingView.
Ethereal (ETH) bounced back above $3,040 after testing $2,800 in the early hours of Monday. Solana AND Polka dot each posted gains of 0.5%.
Celestia (TIA), Starknet (STRK), and Notcoin (NOT) were the top performers among the top 100 cryptocurrencies by market cap over the past 24 hours, with gains of 14.8%, 9.8%, and 7%, respectively.
NOT is also the strongest performing asset over the past seven days with a 21.2% rally. Only five digital assets are currently up for the week.
In particular, cryptocurrency short positions have seen heavier liquidations than long positions over the past 12 hours, generating $159.4 million out of $202.1 million in margin calls. Shorts have also accounted for $184 million of the $350.4 million in liquidations over the past 24 hours, according to CoinGlass.
Around 88,240 traders faced margin calls during the past day.
Spot Ether ETFs Looming
The market volatility comes as analysts continue to delay their forecasts for spot Ether ETFs receiving final approval from the U.S. Securities and Exchange Commission (SEC). While the SEC has approved the funds Forms 19b-4 in May, the regulator has yet to give the green light S-1 Registration Statements from potential issuers.
Nate Geraci, co-founder of the ETF Institute, predicted that the funds would launch within fifteen days of the SEC requiring issuers to submit revised documents by July 8th.
“Will be shocked if spot ETH ETFs [are] we will not be trading in the next 2 weeks”, Geraci tweeted.
“Later next week [is] a possibility, but think about the week of July 15th [is] more likely.”
While analysts have suggested that the launch of spot Ether ETFs is imminent, Golem, an Ethereum-based decentralized computing protocol that conducted an initial coin offering in November 2016, has been spotted in movement Over $115 million in ETH has been transferred to centralized exchanges in the last 37 days, according to data from Arkham Intelligence.
Since Golem has moved assets to Binance, Coinbase, and Bitfinex over the past 37 days, it is likely that the transfers contributed to the recent selling pressure plaguing Ethereum markets.
German Government Sells 17,500 BTC in 20 Days
Bitcoin appears to be absorbing even heavier selling, with the wallet According to Arkham Intelligence, it is believed to be controlled by German authorities, who have been dumping large sums of BTC every day since early July.
In January the German police announced had seized 50,000 BTC from an individual who worked for Movie2k, a popular website that distributed pirated movies between 2008 and 2013. The individual agreed to transfer his Bitcoin to authorities after being held in custody since he was arrested in 2019 on suspicion of money laundering.
Last month, BTC began to flow out of the wallet, with outflows accelerating in recent days. On Monday, the wallet transferred 2,206 Bitcoin ($123 million). The wallet now holds just 32,488 BTC worth $1.86 billion, down from $3.2 billion when it began dumping funds on June 19.
Traditional markets see smaller losses
Meanwhile, in traditional markets, U.S. stock futures fell slightly on Monday morning as investors awaited key inflation data. S&P futures fell more than 0.1%, while futures tied to the Dow Jones Industrial Average lost 0.19%. Nasdaq 100 futures fell about 0.14%.
However, the release of June’s consumer price index on Thursday and producer price index data on Friday could influence market expectations if the numbers show slight improvements.