Hot Development: USA Is Depositing Bitcoin in Coinbase, Is There a Selloff Coming?

Bitcoin price has lost more than 5.5 percent in the last seven days. During this period, BTC hit its lowest level in six weeks at $58,400 on June 25. According to market intelligence firm Glassnode, BTC fell below its short-term cost base during this sell-off. Therefore, it faced the risk of a deeper correction. Amid these developments, the news that the US government sent 4,000 BTC to Coinbase shook the market. Analysts warn that current sales may continue.

US government address sent nearly 4,000 BTC to Coinbase

According to information from Arkham Intelligence, a crypto wallet known to be controlled by the US government recently transferred 3,940 Bitcoin (BTC) worth approximately $241 million to Coinbase. The latest transfer highlights that the US government continues to manage seized Bitcoin assets.

Source: Arkham

The wallet’s Bitcoin stash was linked to Bitcoin seized from Silk Road. cryptokoin.com As you may have seen from , Silk Road was a notorious online marketplace for selling illegal drugs, weapons, and other illicit goods on the dark web, and was shut down in 2013. The US government has added Silk Road’s entire BTC stash. The US government’s current holdings in Bitcoin are worth approximately $13.3 billion.

Analysts Warn of Deeper Sell for Bitcoin

“Since mid-June, the spot price has fallen below the cost of both 1w-1m holders ($68.5k) and 1m-3m holders ($66.4k),” Glassnode wrote in its On-Chain Weekly Report published on June 25. “If this pattern continues, it historically leads to a breakdown in investor sentiment. It also carries the risk that this correction will be deeper and take longer to recover,” the analysts wrote.

Bitcoin realized price according to groups. Source: Glassnode

Bitcoin short-term holders (STH) cost basis is a metric that represents the average purchase price of BTC for investors who are considered short-term holders. It is generally defined by the movement of coins held for less than 155 days. Data from LookIntoBitcoin reveals that BTC exceeded the $64,000 level on June 23, falling below the STH Realized price of $64,591 at the time.

Bitcoin short-term conservative realized price. Source: LookIntoBitcoin

Additionally, the recent decline was inches away from pushing the BTC price below the cost base of 3m-6m holders at $57,300 and continues to rise even as the price drops. The report also emphasizes that the cost of 1w-1m holders has fallen below the cost of 1m-3m, signaling “a decreasing momentum on the demand side and a net capital outflow from the asset.” In this context, analysts say, “During previous bull markets, negative capital flow structure occurred up to five times. “We can see that this structure has continued since May and early June.” says.

Bitcoin capital flow compared to STHs. Source Glassnode