The Bitcoin blues may persist through July, but investors are still optimistic about the cryptocurrency in the second half of the year. The cryptocurrency has yet to break out of the narrow range it has been stuck in – between $60,000 and $70,000 – since March. This week, it fell to the lower end of that range and is now on track to end June down 10%, according to Coin Metrics. That would make it its worst month since April and the second month of decline in three. July is typically a strong month for bitcoin, which has finished highest for the month in seven of the last 11 years, according to CoinGlass. At $61,000, bitcoin has key support at the $67,000 level, chart analysts say, although a breach below that could be “damaging.” Investors are worried about the cryptocurrency falling again due to oversupply in July. “The Bitcoin halving was a known positive supply event for the market this year – we have fewer bitcoins being produced,” said Zach Pandl, managing director of research at Grayscale Investments. “There are always other known potential sources of government bitcoin supply, for example, but it’s always uncertain when that hits the market. To some extent, the supply being liquidated by things like government agencies is partially negating the positive effects in the short Bitcoin deadline.” This week, the cryptocurrency market was surprised when the US and German governments sent large amounts of previously seized bitcoins to exchanges, according to CryptoQuant. Additionally, the administrator of the defunct exchange Mt. Gox announced that it will begin refunds to creditors – 142,000 bitcoins worth $9 billion in today’s prices – from July. Some investors are concerned that creditors could sell some of that bitcoin in July after waiting more than 10 years for a resolution with the exchange. “This fear is justified given the recent behavior of Gemini’s creditors, who have reportedly liquidated some of the crypto assets received in recent weeks; in particular, nearly $2 billion in crypto assets returned to 232,000 retail customers by failed crypto lender Genesis and exchange crypto Gemini platform,” JPMorgan’s Nikolaos Panigirtzoglou said in a note this week. “A similar downside risk looms in July with Mt. Gox creditors,” he added. “Assuming that the majority of settlements by [them] occurs in July, this creates a trajectory where cryptocurrency prices come under more pressure in July, but begin to recover from August.” BTC.CM= 1M mountain Bitcoin’s return to $60,000 Bitcoin is still solidly in a bull market, however, despite recent and potentially short-term sluggishness, and market participants expect the cryptocurrency to retest its March all-time high of around $73,000 by the end of the year. gets another bearish CPI print, a Federal Reserve rate cut at the central bank’s September meeting would become the base case for many macro investors, he said Bitcoin, along with other risk assets, tends to rise with expectations. of rate cuts. The next consumer price index review is scheduled for July 11. Messages from the US presidential election campaign about the US dollar – which moves inversely to bitcoin – could also catalyze the next leg higher, Pandl said. “We don’t know what candidate Trump’s views are on the U.S. dollar,” Pandl said. “Trump expresses the view that he would like to see lower trade deficits in the US, but so far, he has focused mainly on the need for tariffs.” “It’s possible that during the election campaign, Trump could introduce the idea that we need a weaker dollar,” he added. “These two things in combination would be positive for bitcoin: Fed rate cuts and one of the two presidential candidates talking about dollar weakness.” Marion Laboure, senior strategist at Deutsche Bank Research, said growing demand for cryptocurrency ETFs will help keep the price of bitcoin “elevated” in the coming months. Initial filings known as 19b-4s for ether ETFs were approved in May and the funds themselves are in the process of obtaining S-1 filing approvals — which are expected to occur in the coming weeks. This week, VanEck and ARK 21Shares also filed for what would be the first Solana spot ETFs. “There’s a lot of uncertainty in the market, but I’m quite optimistic,” she said. “I wouldn’t be surprised if we got more ETFs approved as well. If we have a clearer institutional framework, we’ll have more ETFs. … We’re moving toward more democratization, more institutionalization of ETFs.” —CNBC’s Michael Bloom contributed to this report.

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