Bitcoin (BTC) Tumbles 5% Wiping Out $250M Longs as Justin Sun Offers to Buy German Government\'s Coins

Bitcoin continued to drop lower on July 4 during the Asian trading session, contributing to the notable spike in the selling pressure.

Bitcoin price continued its downtrend on July 4, dropping to a two-month low and triggering a wave of selling pressure in the cryptocurrency market.

What Happened: BTC price fell to as low as $54,800 during the Asian trading session, contributing to a 5% decline in the total cryptocurrency market capitalization, which slipped below the $2.2 trillion mark.

Bitcoin’s trading volumes surged by 40% over the past 24 hours, with the majority of the increase attributed to selling activity, according to data from X user @DaanCrypto.

These losses are expected to continue if Bitcoin exchange-traded funds (ETFs) continue to record outflows. On July 3, the total outflows from spot Bitcoin ETFs amounted to $20 million.

The price drop has also resulted in the liquidation of over $78 million in Bitcoin longs during the past 24 hours, as reported by Coinglass.

According to a CryptoQuant analyst, long-term Bitcoin holders are driving the current selling activity. These addresses are currently in profit and selling their BTC in the market.

“The highest activity was observed among holders who had kept their Bitcoin for 5-7 years,” the analyst noted.

These long-term holders are said to be responding to the recent price highs and quickly cashing out their profits.

The sustained selling activity by these wallets may reduce the chances of BTC recovering quickly.

“If Bitcoin fails to hold $58,000, further drops should be expected,” the analyst added.

The SOPR (Spent Output Profit Ratio) for long-term Bitcoin holders indicated values above 10 on July 3, suggesting that these coins were moved on the blockchain last evening, according to X user @LightCrypto_.

This metric highlights the profitability of recently spent Bitcoin outputs, with values above 1 indicating that the majority of coins moved on-chain were sold at a profit.

Demand for BTC at the $60,000 level has been historically weak, according to IntoTheBlock’s demand indicator. This indicates that we could see more selling pressure at this level.

If buyers are unable to overcome the bearish sentiment, the next significant demand zones are at the $50,000 and $40,000 levels, respectively.

See More: Best Cryptocurrency Scanners

Why It Matters: Bitcoin’s price has dropped sharply from its recent all-time high of $64,900, largely due to the German government’s sale of BTC, which has put pressure on the cryptocurrency’s price.

Data from Arkham Intelligence on July 4 showed that the German government transferred 1,300 BTC, valued at over $76 million at the time of the transaction, to the Bitstamp, Coinbase, and Kraken exchanges.

The German government still holds over 40,000 BTC, which could lead to further selling pressure on the cryptocurrency.

Tron co-founder Justin Sun expressed interest in reducing the selling pressure on Bitcoin by the German government.

Sun wants to save the day by buying all the government’s coins. In an X post, Sun offered to “negotiate with the German government to purchase all BTC off-market in order to minimize the impact on the market.”

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