Analysts are divided on Bitcoin's next move, but there's some hope at last. Meanwhile, SharpLink has resumed buying Ether after an eight-week pause, and other market news.
Bitcoin (BTC) reacted positively to US Federal Reserve Chair Kevin Warsh’s remarks on stubborn inflation. Despite the gains on Wednesday, traders fear that incentives for fixed-income investments and strong earnings momentum in tech stocks will continue to pressure non-yield-bearing assets like cryptocurrencies.
The US five-year Treasury yield jumped to 4.22%, meaning traders demanded higher returns to hold government bonds. Even as inflation eventually eases and WTI crude oil prices fell to a 4-month low, investors anticipate monetary expansion.
Regardless of how the Fed manages interest rates and its balance sheet, the US Treasury dictates debt issuance trends.
Bitcoin (BTC) is trading at around $61,490 at the time of publication after falling to a 21-month low of $57,737 earlier on Wednesday.
Ether (ETH) and Solana (SOL) also gained, up 3% and 4.85%, respectively.
The bounce took place amid deep investor caution, with sentiment trackers gauging the balance of fear and greed in crypto markets currently reading around 11 out of 100, which is in “Extreme Fear” territory. Despite the rebound from the yearly low, Bitcoin remains down roughly a third since the start of the year.
Investors’ cautious stance shows up clearly in the institutional products. US spot Bitcoin exchange-traded funds (ETFs) have hemorrhaged funds in recent weeks, including a reported $4.5 billion total outflow in June, the largest since the ETFs launched.
Related: Bitcoin price taps new July high above $62K on weak US jobs data
Bitcoin could face further downside pressure after ending June below its 200-week moving average while still trading above its realized price, a combination that crypto analyst PlanB says suggests the market has yet to reach a bear market bottom.
Bitcoin fell 20.5% in June to close the month at $58,526 — its worst monthly performance since June 2022 — below its 200-week moving average of $62,000 but above its realized price of $52,000.
Bitcoin is down 8.80% over the past 30 days. (CoinMarketCap)
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