Complete Breakdown of the July Fireworks in BTC
Bitcoin’s volatility increased in the month of July due to contradicting forces were added to the price equation of BTC. High profile liquidations bringing strong downside pressure came into the markets, adding large amounts of Bitcoin to the supply side. This occurred in tandem with positive political developments in the form of high-profile supporters of Bitcoin, strengthening the demand side.
Bearish forces
Bitcoin began trading on Monday, July 1st nearly $10,000 (13.46%) below the all-time high at $63, 826 and throughout the first 5 days of trading BTC would make consecutive lower highs and lower lows culminating on Friday, July 5th.
On July 5th the much-anticipated Mt. Gox Bitcoin repayments began. They commenced with 1,545 BTC sent to Japanese exchange Bitbank and 48,641 BTC sent to the major crypto exchange Kraken, thus kicking off the settlements. This had a dramatic effect on Bitcoin’s price, as BTC fell to its lowest price in over 5 months that day.
On Tuesday, July 30th 33,105 BTC were off to an exchange and then to the last creditors to be reimbursed. The wallet which began the month holding roughly 140,000 BTC has ended the month with 13,000 BTC, meaning over 90% of the Bitcoin has been sent off. This is precisely the amount Mt. Gox had claimed they would be returning to customers (90%). This concluded the decade long debacle, with Bitcoin still holding up much better than many analysts anticipated.
While the Mt. Gox Bitcoin has been known about for a decade and the effect on the markets was muted due to a detailed schedule for repayments being issued in advance, another large-scale addition to the supply-side came with less warning.
In January, the German Government seized 50,000 Bitcoin from a movie pirating website. With little warning They begin to offload their holdings beginning on June 19th. They sold their holdings at a feverish pace, completely unloading their wallet by July 13th. This averages out to over 2,000 BTC per day being sold. Especially during the final five days, in which between July 8th and July 13th the government of Germany sold at an average rate of 8,000 BTC per day. This would also be the last day that Bitcoin would close beneath its 200-day simple moving average. A level that Bitcoin had not traded beneath since October 2023 when pricing was below $30,000.
Bullish Forces
Another pivotal event occurred on July 13th, an event that one would not immediately associate with bullish Bitcoin undertones, that event was the attempted assassination of former President Donald Trump. This tragic event that left two supporters in the crowd dead was in fact bullish for Bitcoin not because it simply gave Donald Trump an edge to win the election, but because Donald Trump had announced three days prior that he would be headlining the 2024 Bitcoin Conference to be held in Nashville, Tennessee on July 27th.
Prior to these developments, the only presidential candidate for the upcoming November elections was the nephew of former President John F. Kennedy, Robert F. Kennedy, who had headlined the Bitcoin Conference in 2023. RFK's commitment and knowledge of Bitcoin, as well as his revolutionary ideas on how to use it to further America's economic dominance into the future. If he were to be elected president, it would most certainly be the best-case scenario for Bitcoin and for America.
Sadly, he did not get the Democratic Party's nomination and is running as an independent candidate. If you are like me, you would assume that independent means that this qualifies him, as the best choice for America, but also the underdog in winning the elections.
Those who watched both RFK's and Donald Trump's speeches during the 2024 Bitcoin Conference should easily be able to distinguish who truly believes in the power of Bitcoin and who is simply trying to garner votes from the near 60 million Bitcoin holders residing in the USA and knows less than my 6-year-old sister about the cryptocurrency.
While Trump's speech at the event was by far underwhelming and cemented my opinions on the man who just a few years ago cared zero percent about Bitcoin. Trump’s track record of tweets prior to this month contained only negative comments about the digital asset Yet, still, he made promises that if he were to be re-elected and if they were to be kept, would be very bullish for the asset. More importantly, it would mark a dramatic pivot in the White House's stance towards cryptocurrencies.
He vowed to fire Gary Gensler, release Ross Ulbricht, and commit the U.S. government's 200,000 bitcoin into a strategic reserve on day one of his second term. He also promised to make America the Bitcoin mining hub of the world by means of creating plentiful, cheap energy.
With Trump currently leading Kamala Harris in the polls, it appears we are merely months away from the first president in history that was pro-Bitcoin. Sadly, it probably will not be RFK, although he would be the true pioneer of the industry. The fact that Trump is taking this stance is a consolation prize of sorts.
Conclusion
So, with July ending and August beginning with Bitcoin trading at around $64,000 near the top of its trading range, Bitcoin’s downside potential is limited while its upside potential is not. With the markets absorbing all the added supply, there are fewer black swans swimming atop Bitcoin’s glassy surface and quite a few golden geese arriving at its shores.