Bitcoin Dropped Amid Warnings of Mt. Gox Distributions and Market Awaits Trump’s Crypto Policy Cues
Bitcoin dipped by 1.3% to $99,200 on Monday, following a weekend rally, as investors await more cues on crypto policy from incoming U.S. President Donald Trump. The drop was also attributed to caution over potential distributions by defunct exchange Mt. Gox, which last week moved over $2 billion worth of coins, a move that usually precedes a distribution event.
The optimism over crypto-friendly regulations under Trump’s administration led to a record high of $103,719.4 last week. However, the rally cools as traders await more policy cues ahead of Trump’s inauguration on January 20. The development comes after Trump nominated a crypto-friendly Chair for the Securities and Exchange Commission and named pro-crypto candidates to lead the Treasury and Commerce departments.
Altcoins, on the other hand, have been surging, with many coins seeing gains of over 50% in recent weeks. This trend is largely attributed to hopes that the increased regulatory clarity will shift market focus away from Bitcoin and onto more use cases. The sharp drop in Bitcoin’s dominance, which gauges the percentage of crypto market capitalization held by Bitcoin, further supports this notion, falling to a one-month low of around 55%.
Despite the recent rally, Bitcoin’s performance this year has overshadowed most other cryptocurrencies, leaving them trading at potentially attractive discounts. MicroStrategy, a business intelligence firm, has continued to invest in Bitcoin, purchasing 21,550 coins for $2.1 billion in cash between December 2 and December 8.
The company’s total Bitcoin holdings now stand at 423,650, with an average cost of $60,324 per coin, and a total investment of approximately $25.6 billion. This marks the fifth consecutive week the firm has significantly expanded its Bitcoin holdings. However, the crypto market was cooling on Monday, with major altcoins such as Ethereum, Binance Coin, and XRP recording losses between 2.5% and 7.7%.
