Bitcoin loses 0.7% to $56,000, while Ethereum advances slightly 0.2% to $2,300. The rest of the cryptocurrencies are trading with the majority of losses, led by Dogecoin (2.3%), followed by Near Protocol (2%) and Polkadot (1.4%).
The cryptocurrencies yield up to 2.3% following the US inflation data. Digital currencies are still unable to find direction or relevant catalysts beyond following the movements of American equities.
In this context, Bitcoin loses 0.7% to $56,000, while Ethereum advances slightly 0.2% to $2,300. The rest of the cryptocurrencies are trading with a majority of losses, led by Dogecoin (2.3%), followed by Near Protocol (2%) and Polkadot (1.4%). Meanwhile, Bitcoin Cash (2.2%) and Ethereum are up.
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Volatility in cryptocurrencies
Some analysts point out that the Kamala Harris wins over Donald Trump in the first debate of the campaign The US presidential election could be a factor that is putting pressure on digital assets. Republicans and Trump have been much more openly favorable towards crypto assets, while Democrats and Harris, while they have softened the position taken during Joe Biden’s presidency, have not yet adopted a constructive stance towards the cryptocurrency industry.
Inflation data sows volatility in cryptocurrencies. Analysts warned that a 50 basis point (bp) rate cut by the Fed could send the wrong message about the future. risk of recession and be very damaging to risk assets. Markus Thielen, founder of 10x Research, warns that a rate cut of this size will be “a cause for greater concern” for the market and that the Fed “is behind the curve, having failed to see signs of weakness in the labor market after being caught off guard in July.” At this time of the morning, the CME FedWatch tool gives a 67% probability that the cut will be 25 bps.
Bad signs for risk assets
In this context, cryptocurrencies have been exposed to a high volatility which has not gone down well with digital asset investment products either. For example, spot bitcoin exchange-traded funds (ETFs) experienced net outflows every day during the past week and extended their losing streak to eight consecutive days of losses. This is the first time this has happened since the funds began trading in January. In addition, BlackRock’s IBIT fund recorded its third day of net outflows, the second in just two weeks.
For their part, Binance Research experts believe that all these factors are not indicative of a long-term negative trend.Market fluctuations are to be expected and the long-term fundamentals of the cryptocurrency industry remain unchanged and very strong,” they concluded.
Source: Ambito
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