Bitcoin (BTC) Price Today: BTC Tumbles 2% to $54K as Exchange Deposits Spike, Why Is Bitcoin Down?

Sustained selling pressure gripped Bitcoin as exchange deposits increased due to bearish market sentiment.

Bitcoin faced sustained selling pressure on Friday as crypto exchange deposits surged amid a bearish market.

According to IntoTheBlock data, crypto holders have sent over 21,000 Bitcoin (BTC) to centralized exchanges like Binance and Coinabse in the past week alone.

The total amount of BTC transferred to these trading venues exceeded an estimated $1.2 billion as the token changed hands around $55,000 on Friday.

Several factors have contributed to the selling pressure on Bitcoin, leading to a 21% decline in the past month. These include macroeconomic concerns, impacting institutional participation and government sales, creditor repayments, and market uncertainty.

Inflation data in the U.S. showed signs of slowing but not to the extent of triggering interest rate cuts by the Federal Reserve. The central bank maintained its tighter monetary policies, reducing risk appetite as the Fed aims to reach its 2% inflation target.

Following the halving, which slashed block rewards by 50%, some miners liquidated millions in crypto to cover business expenses. This trend may have slowed even as BTC remained below its $73,000 peak in March and maintained a sideways or downward trend since April. However, mining stocks took a hit during the last dip.

Spot BTC ETF flows also stagnated, with trading volumes for BTC-backed products on Wall Street mirroring price movements, according to ETF expert James Seyffart.

Meanwhile, authorities in Germany and the U.S. have sent thousands of Bitcoin to exchanges in the last two weeks. At least one German lawmaker has criticized the government's BTC sell-offs, arguing that the crypto should be held as a reserve asset.

In the U.S., officials moved $240 million of seized Silk Road BTC to Coinbase. Entities usually carry out these transfers to sell in open markets. Observers also noted that the U.S. used a platform that the Securities and Exchange Commission had previously sued for alleged federal violations.

Bitcoin's 2% slump on Friday was also partly attributed to Mt. Gox repayments. As reported by crypto.news, the defunct crypto exchange began user reimbursements 10 years after one of the biggest BTC hacks to date.

The broader cryptocurrency market saw a widespread decline on Friday, led by Bitcoin's losses over the past few months. According to IntoTheBlock, the digital asset industry lost 8% in 24 hours, dropping to $2 trillion, which marks a five-month low. Despite this, cryptocurrencies have collectively surged by 24% and 73% in six months and over the last year, respectively.

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