Investing.com — Bitcoin prices fell on Wednesday, extending losses seen earlier this week as traders remain averse to the cryptocurrency over concerns that dividends from shuttered exchange Mt. Gox will trigger a massive sell-off.
Sentiment towards the cryptocurrency market as a whole also remains gloomy amid uncertainty surrounding U.S. interest rates, with the recent weakening of the dollar doing little to stem the sector's weakness.
It had fallen 4% over the past 24 hours to $60,339.1 as of 8:20 a.m. ET (12:20 p.m. GMT). The world's largest cryptocurrency continued its steep decline throughout June, remaining stuck in a trading range established since March.
Fearing Mt. Gox’s control, Bitcoin feels little secure
Traders were on edge in anticipation of a payout from Mt. Gox, after the exchange's liquidators indicated they would start returning bitcoin stolen in a 2014 hack to customers by early July.
The exchange is believed to have mobilized around $9 billion worth of Bitcoin earlier this year, but it remains unclear how much of the planned distribution will be.
Traders speculated that recipients of the tokens may be more inclined to sell them due to Bitcoin's massive price appreciation over the past decade, a scenario that would prolong selling pressure on Bitcoin.
Speculation about speculation by other groups has also weighed on Bitcoin. The German government is believed to have sold off Bitcoin retrieved from pirate sites, and some large investors have been seen mobilizing large amounts of Bitcoin this week.
But even before concerns about Mt. Gox began to send bitcoin prices plummeting, sentiment towards the cryptocurrency was seen as generally subdued, with the token having been range-bound for more than three months.
Trading volumes in crypto exchange-traded funds, especially Bitcoin, have fallen significantly in recent months, according to capital flow data.
Cryptocurrency prices today: Rate uncertainty weighs on altcoins
Cryptocurrency prices across the board fell, finding little support from an overnight weakening dollar.
The world's second-largest token fell 4.5% to $3,296.01, with sentiment towards the token remaining weak despite reports that a spot Ethereum ETF could be approved as soon as this week.
fell between 1% and 4.5%, while meme tokens fell by more than 4% each.
The cryptocurrency barely rallied even as Federal Reserve Chairman Jerome Powell signaled progress toward curbing inflation, weighing on the dollar.
But Powell warned that the Fed needs more credibility before it starts cutting rates.
His comments came ahead of further key data on U.S. interest rates, with reports from the Fed's June meeting due to be released on Wednesday and several Fed officials due to speak.
Outside the Fed, data is due to be released on Friday.
Standard Chartered Bank Says Bitcoin Could Hit $100,000 by US Election Day (OTC:)
Bitcoin prices hit a new all-time high in August and could surge to as much as $100,000 before the US presidential election in November, analysts at Standard Chartered Bank said.
“Bitcoin is likely to reach new all-time highs in August and then hit $100,000 by US Election Day,” the analysts stressed in a note on Tuesday.
The bank's forecast hinges on Joe Biden remaining in the presidential race, which the market sees as favorable for Donald Trump to win. Analysts consider Trump to be “positive on Bitcoin” and highlighted the positive correlation between Trump's election odds and Bitcoin price.
“The logic here is that both regulation and mining will be viewed more favorably under a Trump administration,” they wrote.
Standard Chartered also predicted the “least likely” scenario of Biden dropping out of the presidential race in late July, which could see Bitcoin prices fall to $50,000-$55,000.
