Decline in Bitcoin Price
The Bitcoin price drop from $65,000 began on June 20. The German government initiated the liquidation of its reserves. Over the past days, it sold 50,000 BTC worth $3 billion. The latest tranche of 3,846 BTC occurred on July 12.
Negative News Impact
Germany’s actions were compounded by the news of repayments to former Mt. Gox clients starting in July. Previously, we analyzed why the influence of the bankrupt exchange was exaggerated.
Renewed Investment Interest
Once these factors subsided, investment interest surged. On July 15, Hong Kong Bitcoin funds experienced a record inflow of $37 million.
US Investor Behaviour
US investors didn’t show a phenomenal rise in daily inflows. However, they responded more resiliently to Bitcoin’s correction. Consequently, on July 12, American Bitcoin ETFs reached a record $16 billion in total investments.
Global Crypto Fund Statistics
All exchange-traded crypto funds attracted $1.4 billion last week, the fifth-highest in history. Bitcoin accounted for 93.6% of inflows, or $1.3 billion. Ethereum came in second with $72.1 million.
Interest in Altcoins
The renewed interest in altcoins is linked to the progress in launching spot ETFs in the US. According to Bloomberg analyst Eric Balchunas, if the SEC approves updated applications, the funds could start operating fully by July 23.
Investment Opportunities
The July correction offered a good opportunity to increase positions, which investors in exchange-traded crypto funds seized.
Expert Insight
Larry Fink, CEO of BlackRock, the world’s largest investment company, explained the growing interest. He said, “Bitcoin is a legitimate financial instrument that provides protection against the devaluation of national currency caused by excessive budget deficits.”
