Bitcoin's decline is imminent

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Mt. Gox set to begin Bitcoin repayments in July after years of delays

Key points:

  • Mt. Gox to begin repaying stolen Bitcoin and Bitcoin Cash in July 2024.

  • Repayments may put downward pressure on Bitcoin prices due to potential selling.

News - After years of postponements, Mt. Gox, the once-dominant cryptocurrency exchange crippled by a massive hack in 2014, has finally announced a repayment plan.

According to a statement released on Monday, Mt. Gox will begin distributing stolen Bitcoin and Bitcoin Cash to creditors in early July 2024.

Any concerns? This long-awaited move has some analysts concerned about potential selling pressure on the Bitcoin market. Early investors receiving their repayments will be profiting significantly, as the stolen Bitcoin was valued at a much lower price point pre-2013. This scenario could incentivize them to sell at least a portion of their recovered assets, potentially driving down the price.

More details - Repaying creditors has been a complex process for Mt. Gox trustees, taking several years to develop a workable plan. A Tokyo court set a deadline of October 2024 for the repayments to be completed.

Interestingly, just last month, Mt. Gox sparked speculation with a series of on-chain wallet movements. Over 140,000 BTC, valued at around $9 billion, were transferred from cold storage to unknown addresses. These transactions marked the first activity from Mt. Gox's wallets in five years.

The news of the upcoming repayments triggered a slight dip in Bitcoin prices. At the time of writing, the king coin was trading at $61,199 after losing its value by 5% over the last day.

Options traders bullish on Ethereum despite recent price retreat below $3,500

Key points:

  • Traders are buying large quantities of bullish Ethereum call options.

  • Call options allow buying Ether at a specific price by a set date.

News - Even as the cryptocurrency market has slumped, some daring traders are placing bullish bets on Ethereum. This strategy suggests the traders are anticipating a reversal in the recent downward trend.

Ethereum's token, Ether, has shed over 5% in the past week, dipping below $3,350. This decline coincides with speculation surrounding a potential July launch of Ether ETFs in the US. Additionally, it mirrors the broader weakness observed in Bitcoin and other altcoins.

Some interesting observations - However, data from Amberdata reveals a countercurrent. Crypto exchange Deribit has witnessed a surge in buying activity for large-volume September expiry call options with a strike price of $4,000.

Call options are essentially contracts that grant the holder the right, but not the obligation, to purchase an asset at a predetermined price (strike price) by a specific time (expiry). When someone buys a call option, they're essentially betting that the underlying asset's price will climb above the strike price before the option expires.

"The block flow this week shows significant buying activity for September $4,000 call options," explained Greg Magadini, director of derivatives at Amberdata. He interprets this as a sign that traders believe "if ETH surpasses $4,000, it'll likely test and potentially break new all-time highs."

In conclusion - The bullish call option buying spree could be fueled by the expectation of a surge in Ether's price once ETFs become available. This increased activity also aligns with forecasts of heightened volatility in the Ether market. However, not everyone shares this optimism, with JPMorgan remaining unconvinced by the current excitement.

Majority of Japanese institutions plan to enter crypto in next 3 years, survey finds

Key points:

  • Over half of Japanese investment managers surveyed plan to invest in crypto within three years.

  • 25% of respondents view digital assets positively.

News - A new survey by Nomura Holdings and its digital asset arm, Laser Digital, reveals a growing appetite for cryptocurrencies among Japanese investment managers.

The survey, conducted in April among over 500 institutional investors, family offices, and public-service corporations, indicates that more than half (54%) plan to invest in digital assets within the next three years.

This bullish sentiment is further bolstered by the positive perception of digital assets held by 25% of the respondents. Notably, 62% view cryptocurrencies as a valuable diversification tool alongside traditional asset classes like cash, stocks, bonds, and commodities.

What’s more? The survey sheds light on preferred investment strategies, with many investors targeting an allocation of 2% to 5% of their assets under management towards digital assets. Additionally, nearly 80% expressed an investment timeframe exceeding one year, suggesting a long-term approach.

The development of new investment products appears to be a key driver of future investment. Survey participants, both those already involved in crypto and those considering entry, highlighted exchange-traded funds (ETFs), investment trusts, and staking/lending options as catalysts for increased investment.

However, counterparty risk, high market volatility, and regulatory uncertainties remain significant concerns for some investment managers.

CoinShares announces successful sale of FTX claim, secures 116% recovery

Key points:

  • CoinShares sells its FTX claim for a 116% net profit.

  • The company receives £31.32 million on a £26.6 million claim.

News - European digital asset investment firm CoinShares announced the successful sale of its claim on bankrupt cryptocurrency exchange FTX. The agreement, awaiting standard closing procedures, is expected to yield a remarkable 116% net profit after accounting for broker fees.

In simpler terms, CoinShares will receive £31.32 million (approximately $39.78 million) on a £26.6 million ($33.78 million) claim. This positive outcome presents an opportunity for CoinShares to boost shareholder returns and enhance client services.

Notable comments - CoinShares CEO Jean-Marie Mognetti expressed his satisfaction with the deal, highlighting its favorable outcome for the company. He commended his team's "diligence and expertise" for achieving this "exceptional recovery rate."

The proceeds from the sale will be reinvested in "growth opportunities," solidifying CoinShares' market position.

This news comes after CoinShares reported a $21.7 million loss in its Q2 2022 interim results, primarily due to its exposure to the collapsed Terra (LUNA) project in May 2022. The successful sale of the FTX claim marks a significant turnaround for CoinShares.

Did you know?

  • In 2014, the Dogecoin community raised $55,000 to sponsor NASCAR driver Josh Wise and covered his car entirely in Dogecoin and Reddit alien images.

  • Cardano's creators have a love for names. Each step of the platform's development roadmap is named after a famous poet, writer, or computer scientist. ADA, Cardano's native token, takes its name from Ada Lovelace, daughter of Lord Byron and a 19th-century mathematician.

  • In 2021, blockchain startup SpaceChain launched the first Ethereum node in space. By extending the Ethereum network beyond Earth, the project aims to enhance the security and resilience of blockchain technology.

Top 3 coins of the day

Solana (SOL)

Key points:

  • SOL was trading at $127 after declining by 11.52% over the last seven days.

  • The coin was dominated by selling pressure over the last day as well.

What you should know - After getting a rejection at $210 on 18 March, SOL has been on a downtrend with occasional attempts to turn the $187 resistance into support. Unfortunately, bears have been successful in keeping their dominance alive. At the time of this analysis, SOL was trading at $129 with a comparatively better trading volume in over three days. The cause of concern remained the near-term support which stood firm within the range of $98-$117. Notably, a breach of $115 would be quite risky for traders going long. But the possibility of that looked thin at the moment, thanks to the RSI indicator which showed, a trend reversal could be expected soon.


Key points:

  • FLOKI was one of the memecoins that took heavy losses in the past week.

  • Fear and Greed Index showed ‘fear’ as the prevailing sentiment for this memecoin.

What you should know - FLOKI registered the highest losses in the past week at 13% after WIF which fell by 27%. The bearish bias was quite evident in the steep decline FLOKI noted in the last 17 days with an approximately 50% loss in its value. At the time of writing, it was trading at $0.0001619 with no hopes of a quick recovery in sight, as indicated by the red histograms of Awesome Oscillator. Well, if the downtrend continues, FLOKI will find support near the $0.00013271. For bulls to take over, FLOKI needs to cross its short-term resistance at $0.00020745.

Bitcoin Cash (BCH)

Key points:

  • At press time, BCH was trading at $354 with a 7% decline in the last 24-hours.

  • BCH’s Open Interest has declined substantially after 7 June.

What you should know - Similar to other altcoins, Bitcoin Cash (BCH) has been on a downward trend for the past 17 days, mirroring Bitcoin's price movements. Currently, BCH finds itself hovering near its support zone of $276-$354. This price range is crucial, as a break below could indicate further decline. Technical indicators like the MACD don't offer much comfort either, with both the MACD line and signal line positioned below the neutral line, suggesting a bearish sentiment. If BCH fails to hold the current support zone, a significant price drop might be imminent.

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