- Rumors suggest the US sold $6.5M in Bitcoin before Biden’s pro-crypto inauguration, causing market instability.
- Despite claims, on-chain data shows no change in US government Bitcoin holdings, raising doubts about the sale’s validity.
- Bitcoin is testing crucial support levels; a breakout above resistance could signal a potential upward move.
A recent report indicates that the US government reportedly dumped $6.5 million worth of Bitcoin in the week before Biden’s inauguration, a pro-crypto president. These claims have been a major source of market instability as many traders are responding to the prospect of more pressure on the bearish side for Bitcoin.
In a recent YouTube video, Rover highlighted that the speculation started this morning with the news that the US government had just sold 69,000 Bitcoins confiscated from the Silk Road website. As for the reports, the Department of Justice (DOJ) got the green light to sell the assets and the deal happened shortly after that. This has raised suspicion with some speculators claiming that the government might try to contain the purchasing power of Bitcoin with 11 days to the inauguration of the first pro-crypto president.
Bitcoin Faces Bearish Pressure
However, it emerged that there were some concerns on the validity of the allegations made. According to on-chain data from Arkham, a platform that tracks Bitcoin transactions, the U.S. government’s holdings have not been adjusted. This has caused a lot of controversy and people are not sure if the information being provided is real or fake.
Nevertheless, the rumors have been unconfirmed, and the price of BTC has dropped. After rising to a high of $102,000, BTC has had a sharp decline. Market participants are still trying to make sense of things as the current level of uncertainty continues to affect market mood.
At the time of writing this, BTC is trading at the crucial support levels. The cryptocurrency is bearish, having formed lower highs and lower lows. This pattern suggest that there is still selling pressure present in the market. Still, the Relative Strength Index (RSI) has separated, which may indicate that some strength is being concealed and, if the price remains at the current level, the reversal may occur.
Key Support Level
The price of Bitcoin is also in the range bound and creating a symmetrical triangle on the daily chart. This pattern normally implies that the market is not in a position to make a directional move either upwards or downwards. Much attention is paid to the price, as a breakthrough of the support level may result in a new wave of decline. On the other hand a break above resistance could lead to a move upwards.
Now the support level for Bitcoin is a crucial one. A breakdown below this support box which has previously held suggests further decline will be seen. But if the price rebounds from this support level it could mean that a stabilization has occurred and a upward movement could be possible.
Market sentiment is still a bit bearish as traders keep waiting for more details about the events that are happening. Others argue that the selling pressure that may be behind the rumors already has its price implication. However, if the claims are false, Bitcoin may rise again because people’s fear and anxiety will be reduced.
The price of Bitcoin is now range bound and this is a typical situation before a big move. This, however, has to be tempered with the fact that the prices will also be affected by the current rumors as well as the general market conditions.
