Markets
Mt. Gox Refunds Compound BTC’s Problems
Bearish sentiment became more pronounced in the crypto market early Monday after defunct crypto exchange Mt. Gox, which is expected to return more than 140,000 BTC to victims of a 2014 hack, said it would begin refunds next month. Bitcoin slipped to $60,723, recording a loss of more than 5% over 24 hours at one point. Ether and the broader market followed suit, with the CoinDesk 20 Index (CD20) also falling more than 5%. Generally speaking, bitcoin’s recent decline above $70,000 took the form of a double top bearish reversal pattern. However, according to FalconX, spot and futures volumes in the bitcoin and ether markets on centralized exchanges were significantly lower than March’s record highs. This is a sign of diminishing investor participation or conviction in selling stocks, often a characteristic of a “bear trap.”
Ether traders are scrambling bullish options on Deribit in a falling market. According to Amberdata, they purchased the $4,000 Ether call option expiring in September in large numbers in anticipation of a move to new record highs. “Looking at the block flows this week, we’re seeing a ton of buying activity for the September $4,000 calls,” said Greg Magadini, director of derivatives at Amberdata, adding that this is a sign that traders are betting that “if ETH rises above $4,000, we will likely test and hit new all-time highs.
Japanese institutional investors are gearing up for digital assets, says Nomura’s investigation of 547 Japanese investment managers. The April survey showed that more than 50% of managers planned to invest in crypto over the next three years, seeing it as a diversification opportunity. Managers could allocate between 2% and 5% of assets under management to crypto, the survey found, adding that almost 80% would invest over a year. The shift toward crypto follows growing concerns over Japan’s debt levels and the volatility of the yen exchange rate. Metaplanet, recently listed in Tokyo BTC adopted as a reserve asset to guard against Japan’s fiscal problems. Monday, the the company said it would purchase an additional $6.2 million worth of BTC using proceeds from the debt sale.