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Bitcoin price struggles around $65,000 as Mt. Gox transfers weigh

|ByManish Chhetri

  • US spot Bitcoin ETFs records inflows totaling $422.50 million on Tuesday, the largest since June 6.
  • As reported by Tree News, Kraken notified Mt. Gox creditors that it had received its share of the funds. 
  • On-chain data MVRV Z-Score shows that BTC is undervalued, suggesting a bullish move ahead.
  • Hermetica, a Bitcoin DeFi protocol, launched its BTC-backed USDH on Bitcoin's L1 using the Runes protocol.

Bitcoin (BTC) trades slightly up at the time of writing on Wednesday, rising by 0.14% at $65,158 after closing above the daily resistance level of $64,913 the day before. On-chain data indicates that BTC is undervalued, and US spot Bitcoin ETFs recorded inflows totaling $422.50 million on Tuesday. According to Tree News, Kraken notified Mt. Gox creditors that it had received its share of the funds, while Hermetica, a Bitcoin DeFi protocol, launched its BTC-backed USDH on Bitcoin's L1 using the Runes protocol.

Daily digest market movers: Bitcoin price holds the $65,000 level as US Spot ETFs recorded a $422.50 million inflow

  • According to Arkham Intelligence, Mt. Gox likely transferred 48,641 BTC, equivalent to $3.10 billion, to Kraken Exchange, prompting a minor bearish response in the market and resulting in a slight decline in cryptocurrency prices. Subsequently, Kraken notified Mt. Gox creditors that it had received its share of the Mt. Gox funds, as reported by Tree News. As of this morning, the remaining BTC transferred amounts to 43,114 BTC, valued at $2.74 billion, which is still under the control of the Mt. Gox trustee.
  • According to Coinglass Bitcoin Spot ETF data, Tuesday saw inflows totaling $422.50 million, with Blackrock's ETF (IBIT) adding 4,020 BTC valued at $260.20 million. This marks the second day in a row of inflows this week and the largest since June 6. Monitoring these ETFs' net inflow data is crucial for understanding market dynamics and investor sentiment. The combined Bitcoin reserves held by the 11 US spot Bitcoin ETFs stand at $52.39 billion.

Bitcoin Spot ETF Net Inflow (USD) chart

  • Hermetica, a Bitcoin-based decentralized finance (DeFi) protocol, has introduced its BTC-backed synthetic dollar, USDH, on Bitcoin's layer one (L1) using the Runes protocol. The initiative includes future scaling efforts through layer two (L2) solutions like Stacks to enhance Bitcoin-native DeFi operations. This development offers Bitcoin users alternatives that reduce reliance on centralized exchanges and fiat-backed stablecoins across other blockchain networks.
  • According to CryptoQuant, the Market Value to Realized Value (MVRV) Z-Score provides insights into whether the market is overvalued or undervalued. Historically, MVRV Z-Score around -0.5 has often resulted in significant returns, with the metric peaking at 0.8. When combined with the 365-day Simple Moving Average (SMA), the MVRV Z-Score acts as both support and resistance.
  • Currently, the MVRV Z-Score stands at 0.05, finding support from the 365-day SMA indicator. This suggests a potential market bottom and continuation of the bullish trend. This upward movement could persist until it reaches overbought territory, potentially reaching the cyclical peak in the red zone.

Bitcoin MVRV Ration Z-score chart

Technical analysis: BTC price looks promising

Bitcoin price surged above a descending trendline on Sunday, marking a 7% rally over the following two days and achieving a close above the daily resistance level of $64,913 by Tuesday. At the time of writing on Wednesday, BTC is trading slightly up by 0.14% at $65,158. Such a strong upward momentum often precedes a retracement, presenting a potential buying opportunity for investors on the sidelines.

Sideline buyers seeking opportunities can consider positions between $59,200 and $57,800, where the previously broken trendline resistance now serves as support. However, should BTC sustain its bullish momentum, it may advance by 3% from its current trading price of $65,158 to test the weekly resistance of around $67,209.

On the daily chart, the Relative Strength Index (RSI) is currently above the neutral level of 50, and the Awesome Oscillator (A.O.) has also flipped above its neutral level of zero. These momentum indicators strongly indicate bullish dominance.

Furthermore, surpassing the $67,209 level could allow an additional 7% rise to retest its daily high of $71,997 from June 7.

BTC/USDT daily chart

Conversely, if BTC closes below $56,405 and forms a lower low in the daily timeframe, it may signal persistent bearish sentiment. This scenario could trigger a 7.5% decline in Bitcoin's price, targeting its daily support at $52,266.

Bitcoin, altcoins, stablecoins FAQs

Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.

Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.

Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.

Bitcoin dominance is the ratio of Bitcoin's market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.

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