By George Ward
As governments continue to offload their Bitcoin stash, creating fears among crypto enthusiasts, a top CryptoQuant analyst, Ki Young Ju, has downplayed the impact of the Bitcoin selloffs in the broader crypto market. In a recent post on X, Ki Young Ju stated that Bitcoin traders should not panic over the government’s actions.
A Minimal Impact
Ki Young Ju argued that given the general inflows into the crypto market, the effects of the Bitcoin dump by governments are negligible. He stressed that nearly $250 billion has entered the market since the recent bull market started, while the total government-owned assets sold are less than $10 billion.
This viewpoint follows recent changes in Bitcoin’s price characterized by the ongoing government selling activity and wallet transfers connected to the closed-down exchange Mt. Gox. Data from Arkham Intelligence showed that Germany and the United States are the main players, with Germany having 41,200 BTC seized from different illegal actors over the years.
Ki stated that despite these sell-offs, concerns about the selling pressure are unjustified. He argued that government-owned BTC has represented only 4% of the net cumulative realized value and has provided roughly $9 billion to its realized market cap since 2023. Thus, he opined that the concerns over the consequences of the governments’ BTC sales on the market are exaggerated.
Rising Bitcoin ETF Inflows
Meanwhile, the market has recorded a notable increase in inflows into spot Bitcoin exchange-traded funds (ETFs) after BTC’s price dipped below $54,000 following the July 4 US Independence Day celebration. With a $143.1 million funds influx, data from Farside showed that this was the biggest net influx into the Bitcoin product in a month.
Leading the inflows with $117 million was the Fidelity Bitcoin ETF (FBTC). While the ARKB and HODL ETFs noted inflows of $11.3 million and $12.8 million, the Bitwise Bitcoin ETF (BITB) registered a net inflow of $30.2 million.
Unlike the upward trend other spot Bitcoin ETFs achieved, the Grayscale Bitcoin Trust (GBTC) recorded a net outflow of $28.6 million. In a related development, Bitwise CEO Hunter Horsley has lauded the effectiveness of his team’s BTC acquisition at less than half a basis point cost. He further argued that current market conditions offer a good purchasing possibility for BTC.
Increased Market Confidence
Though short-term volatility still exists, the ongoing inflows into Bitcoin ETFs depict consistent belief in the long-term potential of the asset. The BITB ETF received inflows above $66 million during the first week of July, raising its overall BTC holdings to around 38,000.
In addition, the surge shows an increase in institutional investors’ conviction about the future worth of Bitcoin. Meanwhile, Mt. Gox, the collapsed Japanese cryptocurrency exchange, has transferred 47,229 Bitcoin worth $2.71 billion to a new wallet address. As a result, Bitcoin’s price declined, trading at $55,200 on Coinbase.