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Bitcoin Price Movements
Bitcoin experienced a significant drop to its lowest level since late February following reports that Mt. Gox had transferred a substantial amount of BTC to a new wallet. The move, speculated to be in preparation for creditor repayments, caused BTC to plummet to as low as $53,600 before recovering slightly to just over $55,000, representing a 4.75% decline in the past 24 hours. The broader digital asset market, as reflected by the CoinDesk 20 Index (CD20), also saw a decline of approximately 6.85%.
Implications of Mt. Gox Repayments
Concerns have arisen regarding the impending repayment of 140,000 BTC (equivalent to $7.3 billion) by Mt. Gox to its creditors. There are fears that creditors might immediately sell their coins upon receipt, potentially triggering a wave of selling pressure in the market.
Impact on Altcoins
Major altcoins such as ether and dogecoin were heavily affected by the market slump. Ether witnessed a 7.5% decline, while dogecoin plummeted by nearly 11%. Coinalyze data revealed liquidations of over $580 million in bullish bets, with the largest single liquidation order recorded on Binance for an ETH trade valued at $18.4 million. Additionally, open interest in futures contracts dropped by 12%, indicating a reduction in market participation as funds exited the market.
Challenges Faced by Miners
Amidst the price downturn, only a handful of mining rigs remained profitable for their operators. With bitcoin hovering around $54,000, mining operations have become unprofitable for most rigs. According to mining giant F2Pool, rigs less efficient than 23 W/T are currently operating at a loss. The graph shared by F2Pool highlights that only four of Antminer’s rigs and one Avalon rig remain profitable at prices above $53,100, signaling a challenging environment for miners.
Chart of the Day
– Jamie Crawley