On July 5, Bitcoin experienced a significant drop, plunging to $53,600 on the Coinbase platform – a price point not seen since February, sparking concerns among analysts about potential further declines.
Bitcoin (BTC) has since found some stability, trading around $54,122 at the time this article was written, as per the data from TradingView.
On Coinbase, Bitcoin’s value dropped to $53,600 on July 5. Courtesy of TradingView
Josh Gilbert, a market analyst at eToro, spoke with Cointelegraph and attributed much of the sell-off to anxieties over the impending Mt. Gox creditor repayments, which are expected to release approximately $8 billion worth of BTC into the market this July.
After the abrupt fall to $53,600, Gilbert anticipates a further downturn in Bitcoin’s price in the near future. “The current news is predominantly negative, and the evident selling pressure is causing investor unease, which typically leads to additional sell-offs,” he explained.
Gilbert predicts a short-term weakness in Bitcoin’s price until a positive driver emerges, potentially from investors capitalizing on the lower prices or the approval of an ETH ETF, which could enhance market sentiment.
Echoing this sentiment, Pav Hundal, an analyst at Swyftx, also warned Cointelegraph that Bitcoin might face more challenges ahead. “We’re on the cusp of a significant influx of Bitcoin facing a market that’s already indifferent. While the long-term macro outlook remains optimistic, we might see a test of the $50k level, or even lower in the short term. The $52k mark is currently a critical point of contention between the bears and the bulls,” Hundal remarked.
Analysts at 10x Research are also forecasting a continued decline, suggesting Bitcoin’s price could fall to $50,000 in the forthcoming weeks. They caution that selling pressure could intensify if support levels break, leading to a rush for liquidity.
Despite the immediate pessimistic perspective, Gilbert sees reasons for investors to maintain a long-term bullish stance on Bitcoin. He believes that the full approval of an Ethereum ETF by the SEC, expected to launch in July, could significantly uplift the cryptocurrency market.
In related news, the discussion around ‘Bitcoin Layer 2s’ is heating up, with debates focusing on their true classification and significance within the crypto ecosystem.