Finance
Bitcoin falls to its lowest since February even as shares hit an all-time high
(Bloomberg) — Bitcoin fell for a fourth straight trading session, part of a broader crypto sell-off that contrasts with recent record highs in global stocks.
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The digital asset fell as much as 5.6% to hit its lowest level since February, changing hands at about $55,500 at 11:20 a.m. in Singapore on Friday. Smaller coins such as Ether and XRP caused larger losses of more than 10% in some cases.
Crypto speculators are currently facing a range of challenges, including declining demand for US Bitcoin exchange-traded funds, signs of governments throwing out seized tokens, and the difficult-to-analyze impact of US political flux.
In addition, administrators of the failed Mount Gox exchange are returning a wealth of Bitcoin to creditors in phases. Speculators are unsure how much of the $8 billion will ultimately be sold. According to Arkham Intelligence, a Mount Gox-linked wallet moved $2.7 billion worth of the token on Friday.
Correlation Frays
Meanwhile, MSCI Inc.’s global equity gauge is fluctuating. around an all-time high and the short-term correlation between Bitcoin and the 30-day index is declining. The question is whether the risk aversion for crypto is isolated or whether a cautious quarter will also dawn for regular investments after a strong first half for equities.
“There’s just a general lack of buzz in the crypto markets right now,” said Stefan von Haenisch, head of trading at OSL SG Pte. “Most of the news being circulated at the moment, for example the Mount Gox sell-off, is more bearish in nature.”
Von Haenisch said crypto needs more dovish comments on the Federal Reserve’s monetary policy, adding that “one to two rate cuts, coupled with an expansion of the Fed’s balance sheet, are two key ingredients that crypto really relies on.” guard.”
Investors are awaiting U.S. jobs data later Friday for the latest clues about the outlook for Fed policy. Soft recent economic reports have strengthened the case for the US central bank to ease monetary settings in the coming months.
Bitcoin reached a record high of $73,798 in March, buoyed by unexpectedly strong demand for the token’s inaugural US ETFs. The inflows have since faded, causing Bitcoin to fall and putting the rest of the digital asset market in the shadows.
Approvals for US debut ETFs for the No. 2-ranked token Ether are pending, but interest in the products could be mixed if the crypto sell-off continues.
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