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Bitcoin dips as Fed momentum fades.. BOJ sends bullish tones
AI Summary
- Bitcoin slipped slightly after recent rally fueled by US interest rate cut optimism, still on track for a 0.9% weekly gain
- Large-scale treasury purchases by MicroStrategy failed to support prices, SEC announcement of easier rules for listing crypto-linked exchange-traded products did little to boost market
- Bank of Japan sends bullish tones, plans to sell holdings of ETFs and J-REITs, signaling further tightening in monetary policy and keeping expectations of an October rate hike in play
Bitcoin slipped slightly on Friday after the recent rally fueled by optimism over US interest rate cuts ran out of steam, while markets were also affected by relatively hawkish signals from the Bank of Japan.
Cryptocurrencies more broadly also retreated after recovering part of their late-August losses earlier this week, with caution toward the sector persisting.
Bitcoin fell 0.3% to $116,879.6 by 01:43 AM Eastern Time (05:43 GMT). Despite the modest dip, the world’s largest cryptocurrency was still on track for a 0.9% weekly gain.
Large-scale treasury purchases—led by MicroStrategy Incorporated (NASDAQ:MSTR)—failed to support prices this week. Similarly, the US Securities and Exchange Commission’s (SEC) announcement of easier rules for listing crypto-linked exchange-traded products did little to boost the market.
Bitcoin stalls as post-Fed gains fade and BOJ strikes a hawkish tone
Bitcoin had clawed back some of its late-August losses during the first two weeks of September, helped by dip-buying and optimism over an expected Federal Reserve rate cut this week.
But the momentum faded in recent sessions amid rising caution about corporate treasury strategies for crypto investment, with analysts warning of risks to long-term gains from this approach.
Enthusiasm over Fed rate cuts also cooled after the central bank rejected calls for deeper reductions, stressing caution due to persistent inflation pressures. Signs of a weakening US labor market added further uncertainty about the economy’s resilience.
The Bank of Japan emerged as another source of caution Friday after announcing plans to begin selling its large holdings of exchange-traded funds (ETFs) and Japanese real estate investment trusts (J-REITs).
Although the BOJ kept rates unchanged as expected, the planned asset sales were viewed as hawkish, signaling further tightening in monetary policy. The announcement also kept expectations of an October rate hike firmly in play.
The bank additionally flagged ongoing concerns about the world’s fifth-largest economy.
Cryptocurrency prices today: Limited altcoin moves in a lackluster week
Other cryptos saw little movement Friday and looked set for a subdued weekly performance.
Ethereum, the world’s second-largest crypto, fell 0.8% to $4,532.68 and was mostly flat for the week.
Ripple dropped 1% to $3.0404, down about 2% this week.
Binance Coin (BNB) hovered around $992.90 after topping $1,000 on Thursday, with weekly gains of more than 6%.
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