Concern about the US economy breaks into risk assets and cryptocurrency ETFs record the worst second day in their history.
Cryptocurrencies fall for the third consecutive day and Bitcoin gives up 1.42% in the last 24 hours to $93,528. Meanwhile, Ethereum loses its support zone at US$3,300 and is located at US$3,200. Meanwhile, the rest of the altcoins operate with generalized declines of up to 7% led by Stellar, followed by Dogecoin (-3.7%) and Avalanche (-3%). In this context, the outflows of cryptocurrency ETFs marked the second worst day in their history.
According to data from CoinGlass, the recent declines led to liquidations of leveraged long positions worth a total of $1 billion. These declines have also pushed Bitcoin below its initial 2024 price. Companies associated with the cryptocurrency sector, such as MicroStrategy or TeraWulf have also suffered sharp falls in their shares.
At the same time, BTC spot exchange-traded funds (ETFs) recorded a net outflow of $582 millionthe second largest outflow since its approval in 2024, only surpassed by the $680 million recorded on December 19. Spot ETH ETFs also saw outflows close to $160 million, the largest since the end of July.
What variable do analysts look at about the US economy?
This scenario of falls comes after a rebound in US 10-year bond yields, which reached April highs. Experts attribute this rise to growing concerns about the future of the US economy, especially after the latest macroeconomic data surprised with stronger-than-expected figures.
The relationship between BTC and global liquidityl is not strictly linear, but the strengthening of the US dollar and rising bond yields have highlighted economic pressures. These forces intensified following the December meeting of the Federal Reserve (Fed), highlighting the importance of closely monitoring macroeconomic trends.
At the last Fed meetingit was decided to reduce interest rates by 25 basis points and future expectations were adjusted cuts to just two by 2025. The document also reveals concerns about the impact of Donald Trump’s trade policies, especially the possibility of a universal tariff hike.
lFed believes inflation risks have increased due to stronger-than-expected economic data and the possible effects of changes in trade and immigration policies. Given this, the central bank is expected to take a more cautious approach in future meetings, which could lead to a pause in rate cuts, especially at the January 29 meeting.. Upcoming employment data, due out on Friday, could provide more clues about the Fed’s decisions.
Despite the current drop in Bitcoin’s value, some analysts believe this pullback is temporary and could set the stage for a bullish rally, especially if Trump’s economic policy generates optimism in the markets.
Source: Ambito
