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Cryptocurrencies were under pressure on Wednesday, after bitcoin fell back to $60,000 to kick off what is typically one of its strongest months.
The flagship crypto lost more than 1% to $60,767.64, according to Coin Metrics. Previously, it briefly dropped as low as $59,983.64. Ether was last trading down 5% at $2,367.11.
Crypto exchange Coinbase hovered under the flat line while the Bitcoin proxy MicroStrategy gained more than 1%.
Crypto assets fall in early October and fourth quarter
Growing tensions in the Middle East dampened investors’ risk appetite at the start of the new trading month and quarter. On Tuesday, Iran launched a ballistic missile attack on Israel in retaliation for the recent assassination of Hezbollah leader Hassan Nasrallah and an Iranian commander in Lebanon.
“Rising unrest in the Middle East has propelled oil prices higher and strengthened the dollar, casting a shadow over bitcoin and other speculative investments,” said Chris Kline, chief operating officer and co- founder of Bitcoin IRA.
“In contrast to Bitcoin’s stronger-than-expected performance in September, October is shaping up to be a potential rollercoaster, influenced by the delayed ripple effects of last spring’s halving and the approach of a campaign divisive American election,” he added. “Meanwhile, a global monetary tug of war is taking place as various central banks cut interest rates and increase their money supply.”
Additionally, investors are monitoring a strike by members of the International Longshoremen’s Association on the East and Gulf Coasts, which could affect the U.S. economy depending on how long it lasts.
October and November are historically the strongest months of the year for Bitcoin. It ended this month up all but two years in 2013, with an average return of nearly 23%. He became known to native crypto investors as “Uptober.”
Bitcoin struggled to surpass its $70,000 high, although the $55,000 threshold provided strong support for the crypto asset. Some investors doubt that October will be the month it finally comes back to life, but most remain optimistic that the cryptocurrency will test new highs in the new quarter.
