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Why Bitcoin Price Is Down Today: Market Reacts to Mt. Gox Rumors and US Inflation Data

Bitcoin price drops due to Mt. Gox rumors and US inflation data concerns.

Wed, 29 May 2024, 09:17 am UTC

Bitcoin's price dropped by over 3% on May 29 due to market reactions to Mt. Gox rumors and anticipation of Bitcoin options expiration and US inflation data, highlighting the cryptocurrency's volatility.

Bitcoin Price Declines Amid Mt. Gox Rumors and Market Volatility, Traders Remain Cautious

According to CoinGape, the price of Bitcoin declined on May 29, a stark reminder of the market's volatility. Allegations that Mt. Gox had transferred a significant amount of Bitcoin to an unidentified wallet address triggered a broader market selloff. Mt. Gox later refuted these allegations, but the market remained cautious. Despite the denials of a former CEO, the cryptocurrency market could not recover from its decline, emphasizing the need for traders to remain vigilant.

Mark Karpeles, former CEO of Mt. Gox, said "Everything is fine with MtGox. The trustee is moving coins to a different wallet in preparation for the distribution that will likely happen this year, there is no imminent sale of bitcoins happening."

However, as substantial sums of Bitcoin were relocated, the quantity of Bitcoin held by 1K-10K and 10K-1ooK BTC wallet addresses decreased. At the same time, traders were considering other issues, which prompted the mood to remain negative.

CoinGape has stated that over 68,383 Bitcoin options will expire, with a put-call ratio of 0.57. The notional value of these options is around $4.66 billion. After several days of low trading volumes, the maximum pain point is $65,000, indicating a substantial probability of a Bitcoin selloff. Implied volatility (IV) has seen considerable reductions across all main terms, which suggests that turbulent price movements are likely to produce a further retreat in the price of bitcoin.

Cryptocurrency Market Sees $170M Liquidation as Bitcoin Drops Over 3%, Traders Remain Cautious

According to the data provided by CoinGlass, the cryptocurrency market had a daily liquidation of $170 million. Ethereum (ETH) surpassed Bitcoin in liquidation, with Bitcoin (BTC) registering $25 million in long positions liquidation. A single transaction on the cryptocurrency exchange Binance resulted in the most significant single liquidation order ever, for ETHUSDT valued at $4.92 million.

Over the last twenty-four hours, the price of Bitcoin has dropped by more than three percent, and it is currently trading close to $68,243. On a 24-hour basis, the low price is $67,227, and the high cost is $70,479. Traders are showing interest but are exercising caution since trading volumes have increased by more than 25 percent.

Following the previous decline in the dollar index, the US dollar index (DXY) climbed over 104.54 on May 28. Over the same period, the yield on the United States Treasury 10-year note increased to 4.54% due to a selloff precipitated by the dismal outcomes of the 5-year and 2-year auctions. In addition, the President of the Minneapolis Federal Reserve, Neel Kashkari, stated that the current policy stance is extremely restrictive; nonetheless, he highlighted that the policymakers still need to rule out the possibility of more rate hikes entirely.

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