The recent price dip of the chief crypto token has raised several speculations about the potential causes. In this respect, Matthew Sigel (the head of digital assets research at VanEck) has recently revealed that Mt. Gox’s Holdings and Government sales of BTC have triggered its price decline. He has also advised traders to focus on DCA as precaution in these circumstances. Moreover, he advised to allocate only 6% of portfolio to $BTC and $ETH following a 60/40 investment strategy. The executive took to his official account on X to provide insights into the current situation of Bitcoin.
VanEck Executive Highlights Mt. Gox Holdings and Government Sales of BTC as a Cause for Price Decline
In its comprehensive X post, he highlighted the sales that the German and the US governments did. As per him, these sales contributed a lot to shake the position of the top crypto token. In addition to this, he added, the Mt. Gox estate’s likely large distributions have also emerged as a significant factor. While discussing Mt. Gox (a defunct Bitcoin exchange in Japan), he specified that the Mt. Gox trustee presently possesses up to $8B worth of BTC tokens.
As per him, the recent developments signify that the platform intends to disseminate nearly $3B of the respective total. The platform reportedly scheduled the payments to its creditors for July’s start. Nonetheless, it is still uncertain if those to receive Bitcoin from Mt. Gox will sell or hold the coins. Sigel predicts that a minimum of the tokens’ quarter will go to holdings based on Grayscale Bitcoin Trust’s precedent.
Contextually, Bitcoin has been changing hands at approximately $10B per annum on exchanges other than over-the-counter markets this year. Apart from that, the government in Germany has sold 8,000 BTC (accounting for $500M). This amount was a part of the total 50,000 BTC that the government seized in January from the case of movie2k. The latest statistics disclose that their remaining balance stands at 37,000 BTC with a value of nearly $2.1B.
Analogously, the government in the United States also possesses 213,297 BTC (equaling $12B). On the 26th of June, the government transacted BTC of $240M worth to Coinbase Prime, potentially for sale. Sigel added that the price action of this week could additionally offer an early sign of the wider macroeconomic movements.
Prolonged BTC Sales by the Government May Be a Game Changer for Bitcoin’s Further Progress
In the bull run years, Bitcoin seldom trades below the 200-day moving average for above six weeks, a level that it has recently breached. Keeping this scenario in view, government sales could prove a game changer if they prolong BTC sales. However, Sigel of VanEck offered an optimistic view about Bitcoin in the long run while it is seeing increased adoption.
