Friday saw a decline in stocks as well as Bitcoin BTCUSD +0.34% and other cryptocurrencies due to growing anticipation of interest rate increases from the Federal Reserve.
The chilly US jobs data didn’t significantly alter the story.
Over the past 24 hours, the price of Bitcoin has fallen 1% to $30,250, modestly halting losses from $30,100 but remaining vulnerable to a fall below the psychologically significant $30,000 threshold.
Spot Bitcoin ETF Filings and Macro Catalysts Driving Bitcoin’s Rise
After BlackRock (ticker: BLK) and others submitted applications for spot Bitcoin exchange traded funds, Bitcoin surged over that important level last month, raising expectations of renewed institutional and retail interest in cryptocurrencies.
While the apps gave cryptocurrencies a fresh dose of optimism, macroeconomic reasons are also acting as catalysts.
According to Yuya Hasegawa, an analyst at cryptocurrency exchange Bitbank, the news flow regarding spot bitcoin ETF filings appears to be losing its impact on the price, while strong US economic data have increased Treasury yields, pressuring Bitcoin’s price.
On the heels of the US jobs data, a crucial sign of how hot the economy is running, Bitcoin was prepared to move Friday, much like the Dow Jones Industrial Average and S&P 500.
The Fed, which is using higher interest rates to combat decades-high inflation, will closely examine the jobs figures.
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Rising Rates And Cryptocurrency Challenges in 2022
While hope in 2023 that the worst was over helped Bitcoin to its greatest first half of a year since 2019, rising rates were a significant impediment for cryptocurrencies last year.
Markets are preparing for a hike this month and maybe another in September as a result of this week’s robust jobs data, especially the ADP employment report on Thursday, which has rekindled concerns that the central bank would keep raising rates even after stopping in June.
Stocks plunged on Thursday as a result of the ADP news, and Bitcoin soon followed.
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