(Bloomberg) -- Bitcoin slipped below the $67,000 mark as traders took stock of signals that the US government may sell portions of its sizable crypto holdings.
A wallet linked to the US government moved $2 billion of Bitcoin to a new address on Monday, according to blockchain research firm Arkham Intelligence. The US Treasury has amassed billions of dollars in seized cryptocurrencies through crackdowns on platforms like the dark web marketplace Silk Road, a hoard that presidential candidate Donald Trump has pledged to turn into a strategic reserve for the country’s coffers if elected.
Bitcoin fell as much as 2.2% to $65,875 during Asia trading hours on Tuesday, before recovering somewhat to trade around $66,330 as of 10 a.m. in New York. The world’s largest cryptocurrency flirted with the $70,000 mark on Monday for the first time since mid-June.
Traders had leveraged long positions on Bitcoin following Trump’s appearance at a Bitcoin-themed conference in Nashville, Tennessee over the weekend — a trend that is now “selling off” on concerns that the haul might be sold before Trump can be elected, according to Sean McNulty, director of trading at Arbelos Markets.
Conversely, Ether recorded a third day of gains to hover around the $3,400 mark, despite a string of outflows from the newly-forged spot Ether exchange-traded funds in the US.
“The market might be becoming immune to headline outflow figures due to the rotation from more expensive ETHE to the cheaper ETFs,” analysts at QCP Capital said in a note on Tuesday, referring to the Grayscale Ethereum Trust.
Shares of the Grayscale Bitcoin Trust dropped as much as 10% in pre-market trading on Tuesday before turning little changed. The ETF, which converted from a trust in January, will spin off 10% of the fund into a lower-cost “mini” exchange-traded fund to existing investors. The record date for shareholders to receive the spinoff is July 30, so anyone who purchases the shares after today won’t get the distribution.
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