Tuesday, 23 April 2024
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pinned at $66k amid dollar pressure By Investing.com

Bitcoin bulls lie in wait as US dollar strength hits 5-month lows

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Investing.com– Bitcoin price fell slightly on Wednesday, weighed chiefly by pressure from a strong dollar as investors grew more uncertain over the path of U.S. interest rates in anticipation of key labor market data this week.

The fell 0.5% to $66,229.5 by 01:15 ET (05:15 GMT).

A broader decline in risk appetite- marked by a sharp fall in global stock markets- also pressured Bitcoin, as investors pivoted into safe havens such as the dollar and gold.

The raced to a 4-½ month high this week, while notched record highs. 

Risk appetite- particularly in Asian markets- was also dented by a devastating earthquake in Taiwan, the impact of which remained unclear. But this kept Asian stocks trading negative, while the dollar stemmed a decline from recent peaks. 

Bitcoin price on edge as US government seen mobilizing Silk Road funds 

A potential mass sale event also kept Bitcoin investors on edge, especially as the U.S. government was seen mobilizing part of the 30.1K Bitcoins ($2.1 billion) recovered from the Silk Road marketplace. 

Crypto influencer ZachXBT noted on social media platform X that an address associated with the U.S. government had moved $139 million of Bitcoin to a Coinbase (NASDAQ:) deposit address. 

A move onto an exchange could herald a potential sale of the tokens on the open market, presenting some sell-side pressure on Bitcoin. Past crypto seizures by the U.S. government have usually resulted in the government auctioning off the seized tokens.

Bitcoin’s strong price run-up this year- where the token hit a record high above $73,000- was driven chiefly by the U.S. approval of spot exchange-traded funds. 

But capital inflows into these ETFs were seen slowing in recent weeks- a trend that could potentially herald more weakness in Bitcoin prices. 

The prospect of higher-for-longer U.S. interest rates also presents more headwinds for Bitcoin, given that the token usually benefits from a high-liquidity, high-speculation environment.

 

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