CoinDesk Report:
Over the past 24 hours, the cryptocurrency market has experienced significant volatility. According to CoinFinance market data, Bitcoin plummeted from over $60,000 and briefly dipped below the $54,000 mark.
Within 24 hours, Bitcoin dropped by $6,000.
As of the publication on July 5th, Bitcoin is trading at $54,206.2 per coin, marking an over 8% decrease.
Other cryptocurrencies in the virtual currency market have similarly plummeted. Ethereum fell by over 11%, and Dogecoin dropped by over 16%.
Data from CoinGlass shows that over the last 24 hours, more than 230,000 people were liquidated in the cryptocurrency market, totaling approximately $680 million (about 4.9 billion RMB). The largest single liquidation occurred in Ethereum.
According to China Securities Journal,
The flash crash in cryptocurrencies was triggered by the disappointment of market rumors about the launch of an Ethereum spot ETF on July 4th.
According to CryptoQuant data, during this decline, Bitcoin worth $2.4 billion with a holding period of 3 to 6 months was transferred. Analyst Cauê Oliveira noted that this indicates a collective sell-off by investors who bought Bitcoin early in the year, largely speculators anticipating favorable conditions from Bitcoin’s halving.
Additionally, the latest minutes from the Federal Reserve’s monetary policy meeting indicate that most officials still believe more data on declining inflation is needed before considering rate cuts.
According to Securities Times, analysts also believe that recent actions by Binance, the world’s largest cryptocurrency exchange, may have influenced market sentiment. Binance will cease trading services for six currency pairs: BTC/AEUR, ETH/AEUR, AI/TUSD, CHR/BNB, GAS/FDUSD, LQTY/FDUSD, effective from July 5th. The company did not disclose specific reasons for delisting, but reminded that it regularly reviews all listed spot trading pairs and removes some in cases of poor liquidity or other factors.
Simultaneously, Binance has recently added several new trading pairs on its platform. WIF/BRL, ZK/USDC, and ZRO/USDC have been included in Binance Spot. It’s important to note that this service is not available to all customers. Currently, residents in the following countries or regions cannot trade the aforementioned spot trading pairs: Canada, Cuba, Crimea region, Iran, Netherlands, North Korea, Syria, the United States and its territories (American Samoa, Guam, Puerto Rico, Northern Mariana Islands, US Virgin Islands), and any non-government-controlled areas of Ukraine.
Since the beginning of the year, the exchange has implemented several similar changes. Last month, it halted trading services for the following currency pairs: ALPACA/BTC, NFP/TUSD, MDX/BTC, QUICK/BTC, and XAI/BNB. Several months ago, Binance terminated all transactions involving Monero (XMR), leading to a sharp decline in the price of the popular privacy coin.
The recent supply of cryptocurrencies in the market has also seen a significant increase. Public data shows that in July, five new cryptocurrencies will be available for investment: 5thScape (5SCAPE), DarkLume (DLUME), SMOG, PlayDoge, and PEPE.
Image source: Visual China
According to China Securities Journal,
The recent downtrend in Bitcoin is mainly attributed to large-scale sell-offs by cryptocurrency mining companies facing drastically reduced income.
According to IntoTheBlock data, the amount of Bitcoin held by miners has dropped to the lowest level in 14 years. Miners sold over $2 billion worth of Bitcoin in June alone, marking the highest in over a year.
Since the Bitcoin mining reward halving in April, the income of Bitcoin miners has significantly decreased. The income of Bitcoin miners mainly comes from mining rewards and transaction fees. The halving event directly impacted mining rewards, while operational costs such as electricity and equipment expenses remained unchanged. Therefore, many miners may face profitability challenges.
Recently, due to many miners ceasing operations, the Bitcoin mining difficulty has sharply decreased. The latest Bitcoin hash rate has dropped from 8.8 trillion to 8.3 trillion. Despite the decrease in mining difficulty, due to the impact of the halving event, Bitcoin miners’ income in the past two months hit a historic low. Kaiko data shows that total miner income dropped from an average of $107 million per day before the halving to $30 million.
One miner mentioned that with the plummeting cryptocurrency prices, the shipment volume and business revenue of mining machine manufacturers have been greatly affected.
f2pool data shows that with Bitcoin’s trading price dropping below $58,000, inefficient mining machines face challenges under current market conditions. Calculated at $0.06 per kilowatt-hour, Bitcoin miners like Antminer S19, Whatsminer M30S+, and Whatsminer M33S+ are already operating at a loss when turned on.
Image source: f2pool
Compiled from Daily Economic News, Securities Times, and China Securities Journal
