Bitcoin (BTC) Drops Below $59K Following US Government's $591M Silk Road BTC Transfer

On-chain data also shows a trend change in Bitcoin's price correlation to the BTCE fund reserves.

Bitcoin (BTC) dropped below the $59,000 level on Wednesday following news that the US government had transferred 59,140 BTC, valued at $591 million at the time, from the now-defunct Silk Road darknet marketplace to a new BTC address.

Meanwhile, on-chain data also showed a trend change in Bitcoin's price correlation to the ProShares Bitcoin Strategy ETF (BTCE) fund reserves.

As reported by U.Today earlier this week, on-chain analysis had suggested that BTC could decline further as long-term holders were continuing to sell their holdings at a loss.

The analysis showed that long-term holders had been booking profits since March, but the selling pressure had intensified over the past two weeks.

On Wednesday, data from on-chain analytics firm IntoTheBlock showed that long-term holders had realized a loss of nearly 100,000 BTC in the past 30 days. At the same time, short-term holders had realized a gain of 30,000 BTC.

This indicated that long-term holders were still selling their holdings at a loss, while short-term holders were booking profits.

According to IntoTheBlock, this trend could continue to put pressure on the price of Bitcoin in the short term.

However, on-chain data also showed that a large number of BTC was still being HODLed by long-term holders, suggesting that the selling pressure from long-term holders could eventually ease up.

At the time of writing, BTC was trading down by 0.5% over the past 24 hours at $58,983. The world's flagship cryptocurrency had encountered resistance at the $63,000 level earlier this month and has since been trading in a range between $58,000 and $62,000.

News of the US government transferring BTC from the Silk Road to a new address also emerged on Wednesday.

According to blockchain data, the government had moved 59,139.9 BTC, valued at $591,346,740 at the time, from the Silk Road address (149J86knpXz667Z54sALptHmXg3xrG845J) to a new BTC address (bc1q9708m4y5408d7435033337987777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777777).

The government had seized the BTC in 2014 following the closure of the Silk Road darknet marketplace by the Federal Bureau of Investigation (FBI).

BTC telah duduk di alamat Jalan Sutera sejak itu, dan pemindahannya ke alamat baharu pada hari Rabu menandakan kali pertama kerajaan memindahkan BTC daripada alamat Jalan Sutera.

Tujuan pemindahan BTC oleh kerajaan AS tidak jelas pada masa penulisan.

Namun, ada yang membuat spekulasi bahawa kerajaan mungkin sedang bersedia untuk menjual BTC atau menggunakannya untuk membiayai operasi penguatkuasaan undang-undang yang lain.

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