Bitcoin Price Ignores Technical Events on the Network

• The Coldcard hack moved thousands of BTC without causing a corresponding drop in price.
• The BIP-110 fork also did not push BTC out of the $65,000 range.

In less than ten days, Bitcoin faced two episodes capable of triggering alarms within its own ecosystem. The price, however, barely flinched.

Let’s take a brief look back. On July 30, the hack of Coldcard hardware wallets forced thousands of users to move their funds due to the risk of their bitcoins being compromised.

Just nine days later, on Saturday, August 8, BIP-110 arrived. Its activation ended up separating the nodes that adopted those rules from those that continued using the standard software, as explained by CriptoNoticias.

Two very different events, one market reaction: practically none. It is enough to observe the price range in which bitcoin moved over the last month and, especially, after these two events.
Bitcoin price in the last 30 days. Source: CoinMarketCap.

And from this arises the following question: if Bitcoin's own events can no longer move its price, what is?

Two Internal Events That the Price Practically Ignored {#h-dos-eventos-internos-que-el-precio-practicamente-ignoro}

The case of BIP-110 is particularly interesting because the possible scenarios were laid out before its activation.

The proposal seeks to temporarily restrict certain non-financial data uses in Bitcoin and never achieved broad consensus. Before reaching the activation block, Aaron van Wirdum, a journalist specializing in Bitcoin, warned that only between 1% and 2% of the mining power was signaling support.

In his analysis, he proposed three possibilities: that practically no miner would support the proposal, that the majority would adopt it, or that a sufficiently large minority would end up building an alternative chain.
The BIP-110 chain barely managed to mine 2 blocks after the fork. Source: bip110.orange.surf

Regarding this last scenario, he explained: "If the Bitcoin blockchain is permanently divided, this essentially marks the creation of a new cryptocurrency."

This was not a minor consequence. Van Wirdum also warned about a potential dispute over which chain would retain the BTC designation and the absence of replay protection, which would allow a transaction made on one chain to be replicated on the other.

Ultimately, there was a separation between the nodes, but the BIP-110 branch ended up with a fraction of the hashrate of the standard chain. And, in this context, the technical dimension of the event found no equivalent in the market.

Coldcard, for its part, left a similar signal from another angle. In this case, the problem was not with Bitcoin, but with a self-custody tool. The attack resulted in the theft of over 2,000 BTC and caused a migration of funds that significantly altered on-chain activity.
Coldcard generated seeds with lower entropy for years. Source: ColdCard.

For the affected users, the consequences were direct. The price of BTC, meanwhile, seems to have been completely unaware of what was happening in the ecosystem.

So, what is moving bitcoin?

While these internal events have gone virtually unnoticed in the price, much of the attention from investors remains outside of Bitcoin.

The Federal Reserve (Fed) occupies a central place. Expectations about interest rate cuts modify liquidity conditions and risk appetite. A more expansive monetary policy can favor the inflow of capital into assets like BTC, while high rates for a longer time increase the relative attractiveness of traditional instruments that offer returns.

Bitcoin exchange-traded funds (ETFs) in the United States have deepened that connection. Their inflows and outflows have become a direct channel for traditional investors' capital allocation decisions to reach the BTC market. Their performance is now one of the variables observed to interpret institutional demand.

In addition, there are factors completely unrelated to the protocol. The war in the Middle East and trade tensions arising from Donald Trump's tariff policy affect expectations about inflation, economic growth, and risk aversion. Bitcoin is thus exposed to risk-on and risk-off decisions similar to those affecting other markets.

Even events involving large corporate holders have had the capacity to modify sentiment.

Strategy, the publicly traded company with the largest corporate bitcoin reserve, generated concern at the end of May when it began to divest a small portion of its holdings after nearly four years.

However, it is worth clarifying here: subsequent sales did not provoke the same reaction. For example, between August 3 and 9, the firm chaired by Michael Saylor sold 1,690 BTC, and the price of the digital currency remained above $65,000.

What does this mean? It could be interpreted as the market seems to have incorporated Strategy's sales as a possible event within its strategy, reducing the surprise effect that the first operation had. Once the assumption that the company was only accumulating BTC was broken, the new sales ceased to represent a bearish factor for investors.

Decentralized does not necessarily mean uncorrelated

Here an important distinction arises. That Bitcoin operates without a central bank and has a monetary policy determined by its protocol does not necessarily mean that its price can remain isolated from the traditional financial system.

The institutionalization of bitcoin reinforced its position as a financial asset, but it also incorporated participants who manage BTC within portfolios where it coexists with stocks, bonds, commodities, and cash. For them, the decisions to buy or sell may depend on the same macroeconomic variables used to allocate capital in other markets.
Some of the macroeconomic events that negatively impacted the price of BTC. Source: TradingView.
That also does not automatically allow us to assert that bitcoin has become a correlated asset with stocks. To demonstrate this, it would be necessary to statistically measure its relationship with indices such as the S&P 500 or Nasdaq over different periods.

What recent events do allow us to observe is something else: the price formation of BTC seems increasingly sensitive to the surrounding financial environment.

Perhaps, based on what has happened in recent days, we need to see how much of the bitcoin price continues to respond to its own logic.

Tags: Bitcoin (BTC) Latest Prices and Trading

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