Weekly Recap Bitcoin reaches 5month low as Mt Gox starts repayments and Circle obtains MiCA license

Today’s edition of the weekly recap: Bitcoin (
BTC
) drops to a five-month low amid a series of whale selloffs; Mt. Gox begins creditor repayments; and Circle secures first stablecoin license under MiCA as regulatory efforts mount.
Market downtrend
Following a bearish June,
reports
from July 1 suggested that Bitcoin could be poised for recovery in July. This was based on historical performance and a good start to the month.
However, Bitcoin’s run came to a halt when it reached a one-week high of $63,861 on July 1. Bitfinex analysts
confirmed
that BTC had diverged from the currently bullish U.S. equities, as it fell below $63,000 and failed to reclaim the level.
Glassnode
stressed
that Bitcoin was in an indecisive phase amid bearish pressure. BTC witnessed three consecutive intraday declines, dropping below $59,000 on July 4 as
signs
of miner capitulation emerged.
Bitcoin hits 5-month low
Despite the downtrend, Core Scientific founder Darin Feinstein
remained
bullish, stressing that BTC was undervalued. Bitcoin continued to record lower lows, dropping below $57,000 on July 4 and
triggering
selloffs among new holders.
A combination of miner capitulation, whale
exchange deposits
, selloffs from the German government and Mt. Gox repayments
exerted
more bearish pressure on BTC, eventually leading to a 5-month low of $53,485 on July 5.
The Bitcoin slump affected the broader market, leading to
losses
for the altcoin market. In addition, Bitcoin mining stocks also
witnessed
considerable declines.
Meme coins rally
Following the downturn, Bitcoin looked to recover, reclaiming $58,000 on July 6. However, while the firstborn crypto’s strength soon failed, meme coins recorded more robust recoveries.
Market data
confirmed
that BONK, dogwifhat (WIF), PEPE and BRETT all recorded gains of more than 15% over 24 hours on July 6. Meanwhile, BTC has receded back below $58,000.
Last week also saw relatively low crypto funding activity, primarily due to the July Fourth holiday in the U.S. Yet, Sentient, an
artificial intelligence
(AI) research organization, collected an impressive $85 million in seed funding. Several other startups
raised
venture capital, too.
German government’s distribution campaign
The market crash was due to multiple factors bordering on selling pressure. Data from Lookonchain revealed that the German government had continued to distribute part of the 50,000 BTC seized from the defunct piracy platform Movie2k.
The government has moved Bitcoin daily since July 1, sending out 7,070 BTC tokens last week, a trend that compounded pressure on the market. The German government now
holds
39,826 BTC during this press.
On July 4, Tron founder Justin Sun
disclosed
his willingness to purchase the German government’s BTC off the market to reduce the selling impact. Also, German legislator and Bitcoin advocate Joana Cotar
charged
the government to stop the BTC sales.
Meanwhile, the U.S. government, which holds a larger amount of Bitcoin, distributed some of its holdings last week, amounting to 274 Bitcoins.
Mt. Gox begins repayments
The Mt. Gox repayments also contributed to the selling pressure. Mt. Gox, which recently
announced
plans to begin repayments this month,
carried out
a series of test transactions on July 4, confirming intentions to move their assets.
On July 5, the collapsed exchange
transferred
47,228 BTC to a new address in preparation for the repayment. Creditors eventually
confirmed
that the repayments had begun as of July 4, with reimbursements in BTC and Bitcoin Cash (BCH).
Circle secures stablecoin license under MiCA
With MiCA’s stablecoin legislation in full swing, Circle
received
a license to provide stablecoin services around USDC under the new law across the European Union, making it the first stablecoin issuer to procure this licensing.
The central bank of Russia might consider the legalization of stablecoins to leverage them for trade with
China
.
Other regulatory developments
The European Banking Authority (EBA)
confirmed
the expansion of its guidelines around Travel Rules to cover firms providing services on crypto. This move, which will take effect from Dec. 30, is an attempt at bolstering AML procedures.
In the U.S., a judge
approved
a motion from Ethereum development firm Consensys to expedite the timeline of its legal case against the SEC.
Mike Novogratz, founder and CEO of Galaxy Digital,
argued
that the U.S. crypto industry would secure the much-needed regulatory clarity regardless of who wins the forthcoming presidential election.
Read more:
IRS unveils new crypto tax rules: Are they a good thing?