Bitcoin price saw a 2.4% increase on Thursday, following a general uptick in risk-driven markets fueled by expectations of a September interest rate cut. However, gains were capped due to concerns surrounding potential token distributions by Mt Gox.
Risk sentiment was also dampened by a significant downward revision in U.S. labor data, raising worries about a looming recession. Despite these factors, Bitcoin managed to climb to 60,751.8 by 00:50 ET (04:50 GMT).
Mt Gox Moves Tokens, Fueling Speculation
Wallets linked to the now-defunct Mt Gox exchange were observed moving approximately $700 million worth of tokens on Wednesday, after transferring $2 billion earlier in the week. This activity has raised fears of increased Bitcoin supply and potential selling pressure on the cryptocurrency.
While the exact amount of Bitcoin held by Mt Gox remains uncertain, estimates suggest it could be around 46,000 tokens, valued at $28 billion based on current prices.
Fed Minutes Point to Rate Cut, But Recession Concerns Loom
The release of the Federal Reserve’s meeting minutes from late July indicated a leaning towards lower interest rates in September, boosting expectations for a rate cut. However, the downward revision in payrolls data has reignited fears of a U.S. recession, casting a shadow over the outlook for risk sentiment.
Despite the potential economic challenges, lower interest rates could create a favorable environment for speculative assets like cryptocurrencies.
Altcoins Follow Bitcoin’s Lead in Crypto Market
Altcoins mirrored Bitcoin’s gains, with the overall crypto market experiencing an uptrend. However, the increase in prices was moderate, with some tokens showing greater movement than others.
Ethereum rose by 1.1% to $2,622.35, while XRP dipped by 0.5%. Dogecoin surged by over 13%, and Cardano and Polkadot also posted gains of 2.8% and 0.3% respectively. Among meme tokens, Shiba Inu rose by 1.2%.
Overall, the crypto market remains influenced by various factors such as market sentiment, economic indicators, and regulatory developments.