Bitcoin Price Swings Amid German Sales and U.S. ETF Inflows

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The price of Bitcoin briefly spiked above $59,000 during early U.S. trading hours on Wednesday, dipping back to around $57,600 later in the day. Amid this volatility, the digital currency remained under pressure, largely due to German selling activities and ongoing spot Bitcoin exchange-traded fund (ETF) inflows.

In Germany, the government’s cache of Bitcoin, originally seized from the online piracy website Movie2k, has diminished in value to less than $1 billion. This represents a significant decrease from the initial stash of nearly 50,000 Bitcoin, with Germany now holding just 13,110 Bitcoin. The liquidations over the past few days have fed into the market, contributing to some level of selling pressure.

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Despite Germany’s offloading of assets, U.S. spot Bitcoin ETFs have seen robust inflows over the first two days of the week, totaling $511.2 million, according to data from Farside Investors. This influx suggests sustained investor interest in diversified and regulated exposure to cryptocurrency, buoying market sentiment.

Wednesday marked a pivotal day for U.S. crypto regulation as the House of Representatives prepared to vote on a bill that aims to override President Biden’s veto. The bill would dismantle the Securities and Exchange Commission’s (SEC) restrictive policies on crypto asset custodianship, potentially enabling traditional banks to more easily offer digital asset custody services. However, Caitlin Long, CEO of Custodia Bank, expressed skepticism on social media platform X about Congress securing enough votes to overturn the veto.

In a related development, key Democratic leaders, crypto industry representatives, and White House officials were slated to convene on Wednesday, a meeting organized by Democratic Representative Ro Khanna of Silicon Valley. Nevertheless, Democrats have been slow to rally behind crypto enthusiasts as a solid voting bloc, a contrast to Republican presidential candidate Donald Trump’s more proactive engagement. Trump has promised regulatory relief for the crypto industry, positioning the GOP as more favorable to the sector by incorporating protections like the right to Bitcoin mining and self-custody of crypto assets into their official platform.

Simultaneously, a Senate committee held a hearing on digital commodity oversight, featuring testimony from Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam. Behnam lamented the lack of legislative progress in addressing digital asset scams that harm everyday Americans. “What has concerned me most throughout the expansion of this digital asset class is that while everyday Americans fall victim to one digital asset scam after another, there remains no completed legislative response,” he stated, urging Congress to take definitive action to protect consumers.

Further adding to the day’s financial focus, Federal Reserve Chairman Jerome Powell continued his Congressional testimony, which was closely monitored by market participants for signals on future interest rate policies.