Bitcoin‘s price experienced a slight dip on Friday, contributing to a modest weekly performance as concerns over potential token distributions from Mt Gox and an uncertain regulatory environment dampened the recovery in cryptocurrency markets. By 01:46 ET (05:46 GMT), the world’s largest cryptocurrency edged down 0.1% to $58,238.5, setting up a weekly gain of about 1%. Despite this, Bitcoin remained entrenched within the $50,000 to $60,000 trading range that has characterized most of the year.
The digital currency faced pressure from a brief rebound in the U.S. dollar on Thursday, further hindering its recovery.
Bitcoin Lags Behind Stock Market Recovery Despite Improved Sentiment
While sentiment improved across risk-driven markets due to easing fears of a U.S. recession and ongoing expectations of interest rate cuts by the Federal Reserve, the cryptocurrency market failed to capitalize on this positive trend. Global stocks posted strong gains this week, with Wall Street indexes reaching two-week highs as volatility eased.
Strong U.S. retail sales data and softer inflation readings bolstered confidence in the U.S. economy, fueling expectations of a 25 basis point rate cut in September. However, despite the potential benefits of lower interest rates for Bitcoin and the broader cryptocurrency market, reports that Mt Gox was preparing to release more Bitcoin to compensate clients affected by a 2014 hack weighed heavily on the sector.
A wallet linked to Mt Gox, holding $2 billion worth of Bitcoin, initiated test transactions this week—often a precursor to a sale event, adding to market jitters.
Additionally, uncertainty surrounding the U.S. presidential election contributed to cautious sentiment in the crypto space. Kamala Harris and Donald Trump are polling closely for the 2024 race, with Trump being the only candidate so far to express a pro-crypto stance.
Earlier this week, data revealed that traders withdrew over $1 billion of USDT from crypto exchanges, signaling a potential risk-off event. Bitcoin exchange-traded funds also continued to experience sustained outflows.
Crypto Market Today: Altcoins Drift Lower
The broader cryptocurrency market mirrored Bitcoin’s weakness, with sentiment in the sector showing little sign of improvement. Ethereum, the world’s second-largest cryptocurrency, fell 1.4% to $2,600.94, positioning it for a 0.4% loss this week—marking its fourth consecutive week of declines.
Other major tokens, including XRP, ADA, and SOL, traded in a flat-to-low range, while among meme tokens, DOGE dropped 0.9%.
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