Bitcoin Price Analysis: BTC Trades Around $115,000 As Macroeconomic Concerns Trigger Liquidations
Bitcoin (BTC) fell to a low of $114,420 during the current session before recovering to reclaim the $115,000 mark. The flagship cryptocurrency continued to trade downwards after setting a new all-time high on August 14, when it reached $124,533.
Investors keen on locking in their profits triggered over $530 million in liquidations, while macroeconomic concerns have soured overall market sentiment.
US Can Fund Bitcoin Reserve With Tariff Surplus
Adam Livingston, the author of “The Bitcoin Age and The Great Harvest,” believes the US can fund Bitcoin purchases for its strategic reserve by using some of its tariff surplus. Livingston proposes using a portion of the surplus generated by trade tariffs to purchase cold storage BTC that is not traded, staked, sold, rehypothecated, used to fund programs or secure loans, or lent out for yield. Livingston added,
“As of July, we've collected $135.7 billion in customs duties — double last year's pace. Let me repeat that we're sitting on a $70 billion surplus from tariffs, and we haven't even finished the fiscal year. That Surplus is unallocated. It’s not pre-spent. It’s not tied to Medicare, entitlements, or debt service. It’s just floating, waiting, looking for a productive use case.”
The proposal to fund the strategic reserve using tariff surpluses could allow the US government to purchase more Bitcoin under Trump’s executive order, which states that the US can acquire more BTC only through budget-neutral strategies.
Strategy Will Buy The Dip
Strategy co-founder Michael Saylor has hinted that the company will buy the dip, and suggested more buys were on the way as Bitcoin (BTC) struggled to regain momentum. Strategy’s latest Bitcoin acquisition occurred on Monday when it purchased $155 BTC for $18 million. The company holds 628,946 BTC, valued at over $74.2 billion. Strategy is up over 60% on its investment, with $28 billion in unrealised gains. The company has established itself as a Bitcoin proxy for institutional funds that cannot hold BTC due to legal mandates or retail customers who don't want to custody crypto.
Saylor recently revealed he is not concerned about the growing trend of altcoin treasury companies competing for investor attention and market share. Saylor stated,
“I still think the vast majority of the capital flowing into the space is flowing into Bitcoin. We’ve gone from about 60 companies capitalizing on Bitcoin to 160 companies just in the past six months; so, I’m laser-like focused on Bitcoin.”
Strategy began its Bitcoin strategy in 2020, and has seen its share price surge over 2,600%, generating interest from crypto traders, institutional investors, and retail equity buyers.
Bitcoin (BTC) Price Analysis
Bitcoin (BTC) is down nearly 2% this week as it continues to trade downwards. According to analysts, macroeconomic concerns and profit taking have weighed the price down. Profit-taking triggered a wave of liquidations across the market. As a result, the market saw over $530 million in liquidations over the past 24 hours. Investors were also disappointed by Treasury Secretary Scott Bessent’s statement about the strategic Bitcoin reserve. Bessent stated that efforts to add to the reserve will remain confined to Bitcoin forfeited to the government, and that the government was only exploring budget-neutral strategies to acquire more BTC.
Investors will also keep a keen eye on the Federal Reserve’s annual economic symposium in Jackson Hole, Wyoming, along with Thursday’s jobless claims data.
BTC’s Monday low triggered debate about whether Thursday’s all-time high marked the end of the current bull cycle. However, some analysts believe the correction is temporary and that the price could reclaim $120,000. The Bitcoin options skew metric reached its highest point in four months, indicating sudden fear. The skew moves between -6% and +6% in ideal conditions. However, Bitcoin whales did not reduce their long positions, showing little or no reaction to BTC’s latest decline and reinforcing the bullish narrative.
The flagship cryptocurrency registered a substantial rally leading up to its latest all-time high. However, price action fizzled out quickly thanks to a lack of catalysts to sustain bullish momentum. BTC typically consolidates after reaching new all-time highs. However, with investors keen to lock in profits, price action has trended downwards, leading to speculation that the asset has reached a local top. Bitfinex analysts believe BTC will continue to experience selling pressure in the near term.
“The market is now firmly in a consolidation phase, adopting a wait-and-watch stance as investors weigh upcoming macro catalysts.”
Bitcoin short positions have increased as well, with $2.2 billion in short positions at risk of liquidation if BTC crosses its all-time high. The large volume of short positions indicates that traders don't expect an upside in the near term. However, Santiment analysts believe Bitcoin whales are confident prices will rise.
“Bitcoin's largest holders are not selling into this rally. Wallets holding between 10 and 10,000 BTC have continued to accumulate aggressively, even after the all-time high.
BTC started the previous weekend in the red, dropping nearly 1% and settling at $116,683. Sellers retained control on Saturday as the price registered a marginal decline to $116,492. However, it recovered on Sunday, rising 2.42% to cross $119,000 and settle at $119,309. BTC reached an intraday high of $122,319 on Monday as bullish sentiment intensified. Despite the positive start, it lost momentum and settled at $118,701, ultimately dropping 0.51%. The price recovered on Tuesday, rising 1.19% to cross $120,000 and settle at $120,113. Bullish sentiment intensified on Wednesday as BTC rallied, rising nearly 3% to cross $123,000 and settle at $123,365.
Source: TradingView
BTC raced to a new all-time high on Thursday, crossing $124,000 and reaching $124,533. However, it lost momentum after reaching this level and dropped over 4% to $118,389. Sellers retained control on Friday as the price fell nearly 1% and settled at $117,436. The flagship cryptocurrency steadied itself over the weekend, registering marginal increases on Saturday and Sunday to settle at $117,488. BTC plunged to an intraday low of $114,703 on Monday. However, it recovered to reclaim $116,000 and settled at $116,286, ultimately dropping 1.02%. Bearish sentiment has intensified during the ongoing session, with BTC down nearly 2%, as sellers threaten to drive the price below $114,000.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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