Cryptocurrencies continued their slide on Tuesday with bitcoin
sinking below $114,000 as investors are turning cautious that Federal Reserve Chair Powell’s Friday Jackson Hold speech may come with a hawkish surprise.
BTC dropped to $113,700 during the early hours of the U.S. session, its weakest price in almost two weeks and pulling back 9% from its Thursday record high above $124,000.
Ether (ETH) slid 3.5% over the past 24 hours below $4,200. Major altcoins weren’t spared either: Chainlink
, Avalanche , Toncoin , Ethena and Aptos declined 4%-6% in a day.
The crypto pullback occurred alongside with traditional markets turning risk-off, with Nasdaq and S&P 500 indexes down 0.9% and 0.4%, respectively, in the morning.
A check of crypto treasury companies shows that bubble continuing to deflate, with BTC accumulator KindlyMD (NAKA) lower by another 14% on Tuesday. ETH-focused names Bitmine Immersion (BNMR) and Sharplink Gaming (SBET) are down 10% and 8%, respectively.
Since soaring as high as $124 in late May in wake of its transition to an ether treasury strategy company, SBET — to pick one — has now crumbled by about 85% to its current $18.60.
The grandaddy of the group — Michael Saylor’s Strategy (MSTR) was down 5.7% on Tuesday, now lower by 20% over the past month and off 37% from a record high hit late last year. Shares, of course, remain up more than 20-fold since Saylor began purchasing BTC about five years ago. Being the first mover has its advantages.
JPOW coming to JHOLE
Investors, who previously saw a September interest rate cut by the Federal Reserve as a given, are now weighing the odds that Fed Chair Jerome Powell might argue for holding rates steady during his Friday keynote address at the Kansas City Fed’s Economic Symposium.
Despite recent signs of a weakening job market and slowing economy, last week’s far hotter-than-expected PPI report reignited concerns of inflation reaccelerating.
Economists at Bank of America said in a report that they see the Fed holding rates in September.
“With inflation essentially stuck over the past year, the tariff pass-through that we still expect, and the labor supply story keeping the unemployment rate historically low, we still think there is a strong case for the Fed to remain on hold,” the analysts said.
Market participants put a 85% likelihood of 25 basis point cut next month, down from as high as 98% at one point last week, according to the CME FedWatch Tool.
