Bitcoin price saw a rise on Monday, bouncing back from recent losses, although overall sentiment towards the token and the broader crypto markets continued to remain negative. The recovery, however, was not without its challenges due to the looming threat of a potential major liquidation event connected to the defunct Mt Gox exchange.
The liquidators of Mt Gox announced plans to start distributing Bitcoin that was stolen during a hack back in 2014. This news led to speculation among traders that the recipients of the stolen tokens might be inclined to sell them, putting significant selling pressure on Bitcoin. This scenario could result in substantial price losses for the token, as was evidenced by the steep losses in late June.
Although Bitcoin experienced a slight recovery, altcoin prices also saw an upward trend on Monday, reclaiming some of the steep losses suffered in June. Ether, the world’s second-largest token, surged by 3.7% to $3,490.79, supported by speculation that the Securities and Exchange Commission might approve a spot Ether exchange-traded fund in the near future. Other altcoins like SOL, XRP, and ADA also recorded gains ranging from 1.5% to 8%, albeit with low trading volumes.
The anticipation of more details on U.S. interest rates, particularly from the Federal Reserve and upcoming economic data releases, kept market sentiment on edge. Traders were eagerly waiting for speeches by Federal Reserve Chair Jerome Powell and the release of the Fed’s June meeting minutes. Additionally, the Nonfarm payrolls data scheduled for Friday was expected to offer further insights into the future direction of interest rates. Some traders were even speculating on a potential 25 basis points rate cut by the Fed in September, a projection that provided some support to the crypto market.
Despite the recent price movements and recovery in the crypto market, the overall sentiment towards Bitcoin and altcoins remained cautious. The looming liquidation event related to Mt Gox’s stolen tokens and the upcoming economic indicators on interest rates continued to create uncertainty among traders. As the market awaits further cues and developments, investors are advised to tread carefully and stay informed about the rapidly changing landscape of the cryptocurrency market.