Aussie Analysts Decode Three Key Factors Behind Bitcoin’s Recent Drop to $60K

Bitcoin has been in a little slump of late. The cryptocurrency has hit lofty heights in the first half of 2024 – reaching a new all-time high, experiencing a successful halving and entrenching itself in the TradFi zeitgeist. With so much positivity, there was always bound to be a pullback at some stage along the journey. 

The most recent episode of Swyftx’s Tapping Into Crypto podcast, hosted by Ted Coaldrake and Tommy Honan, delivered some key insights into BTC’s current struggles and attempts to answer the question on everyone’s lips:

Is now the time to buy?

Related: Bitcoin Price Slumps: Is Recovery Imminent? Analysts Divided Over Future Path

Mt. Gox Repayments to Pump Thousands of BTC into Circulation

The podcast highlights three integral reasons that are likely contributors to Bitcoin’s month in the red.

First, the repayments for Mt. Gox (set to be distributed in the coming weeks) were officially announced. Let’s be clear – victims of a decade-old hack being compensated is hardly a bad thing for the industry. It will go a long way to establishing trust between custodians and investors.

However, Mt. Gox is set to repay somewhere between 60k and 100k+ BTC, which is worth well over US $5b (AU $7.5b). Some in the industry have speculated that a large portion of Mt. Gox victims will immediately sell any assets received, which could put downward pressure on Bitcoin’s price. So, some traders are getting in early, with the idea of re-buying BTC once it hits its bottom.

There are other factors at play too. ETF outflows in the US have gone up a notch this past week, with TradFi investors getting a little skittish. At the same time, Bitcoin miners are also selling off a larger portion of their portfolio than usual to make up for higher operation costs.

To Buy (the Dip) or Not to Buy?

So, where does this leave us? 

According to the Tapping Into Crypto podcast, Bitcoin’s price decline might present a solid opportunity to buy the dip. Several potential investors have been priced out of BTC for much of 2024, and this past month may just be the entry point they’ve been waiting for.

Related: Memecoins Spearhead Crypto Market Revival, with BOME and BONK Leading the Charge

With that said, the podcast hosts were quick to emphasise that Bitcoin’s slump could very well continue. More conservative investors may wish to wait for the Mt. Gox repayments to settle and see how the spot Ether ETF launch goes before jumping back into BTC and other cryptos.