- Bitcoin fell below US$80,000 after stronger-than-expected US jobs data increased expectations for tighter Federal Reserve policy.
- The resilient labour market pushed Treasury yields higher, putting further pressure on riskier assets such as Bitcoin.
- Markets are now watching US inflation data for clues about the Fed’s next move.
- Despite the price weakness, US spot Bitcoin ETFs attracted a combined US$1 billion over the final three trading days of the week.
Bitcoin has dipped once again below the US$80K (AU$110.8K) mark and is currently trading at US$79,019 (AU$109,506). That’s a drop of 1.75% over the past 24 hours, in line with other major cryptocurrencies, which have also fallen over the past day.
Markets slipped lower after a stronger-than-expected US jobs report reshaped expectations for Federal Reserve policy.
US employers added 162,000 jobs in August, far above forecasts ranging from roughly 55,000 to 65,000, while unemployment held at 4.1%. The surprisingly resilient labour market reduced expectations that the Fed would ease monetary policy and instead pushed investors to price in a greater chance of a 25-basis-point rate hike at the September meeting.
That shift put pressure on Bitcoin because higher interest rates generally make cash and government bonds more attractive relative to riskier, non-yielding assets such as cryptocurrencies. Treasury yields rose after the jobs report, adding further pressure on BTC. Markets are now focused on upcoming US inflation data.
A softer CPI reading could revive expectations for easier monetary policy, while another hot inflation print could strengthen the case for the Fed to keep rates higher for longer.
Read also: Strategy CEO Defends Bitcoin Sale as Company Ramps Up Buying Again
Bitcoin ETFs with $1 Billion Inflows
Meanwhile, the US spot Bitcoin exchange-traded funds (ETFs) finished the last trading week on a strong note. After almost US$500 million (AU$693 million) in outflows over two separate trading days (28 August and 1 September), the last three days have seen a combined US$1 billion (AU$1.38 billion) flow into the funds.
The largest ETF, BlackRock’s IBIT, attracted the strongest inflows, with US$686.8 million (AU$951.86 million) over the three trading days.
IBIT currently holds 785,635.3 Bitcoin, or 3.741% of the 21 million Bitcoin that will ever exist, worth US$61.96 billion (AU$85.88 billion).
That makes it by far the largest Bitcoin ETF. In comparison, runner-up Fidelity’s FBTC holds 175,795.3 coins, or 0.837% of all BTC, valued at US$13.86 billion (AU$19.21 billion).
Combined, Bitcoin ETFs worldwide are the largest holders, with a 6.982% share, or 1.466 million coins valued at US$115.63 billion (AU$160.28 billion).
They hold a larger share than public companies such as Michael Saylor’s Strategy.
Read more: Liquid Network Hit by $320M Bitcoin Withdrawal
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