Bitcoin's Price Breakout Sparks Massive Investor Boom
Bitcoin's price movement in August was calm at first, but it turned out to be a harbinger of bigger things. The global market for risk assets was on the rise, with shares in America and gold breaking new highs. Crude oil prices were also easing due to reduced supply fears. Meanwhile, Bitcoin was lagging behind the S&P 500 by more than 4 indices.
The market's volatility was low, but sentiment remained highly fluctuating. This contrast between price action and sentiment would later prove significant. On July 31, a security flaw in Coldcard hardware wallets was exploited, resulting in the theft of around 594 Bitcoins worth approximately $38 million from about 500 self-custodied wallets.
The reaction on the blockchain was intense, with users moving funds to new addresses. According to Glassnode data, Revived Supply 1-year shot up to nearly 119,423 BTC over three days. Interestingly, around 10% of the stolen Bitcoins ended up on exchanges, while about 90% were moved to new addresses.
The institutional sector took a step back, with demand-side factors changing. US spot Bitcoin ETFs returned roughly 65.8K BTC to the market in June, which was their worst month of the year. The corporate market is still buying, but it hasn't fully counteracted ETF outflows.