Nicolas Économou | Nuphoto | Getty Images
Bitcoin fell Tuesday as a rise in Treasury yields weighed on risk assets overall.
The price of the flagship cryptocurrency was last down 5% at $96,525.50, according to Coin Metrics. Ether slipped 8% and the broader cryptocurrency market, as measured by the CoinDesk 20 Index, fell 7%.
Crypto Stocks Coinbase And MicroStrategy fell by more than 8% and 9%, respectively. Bitcoin miners Mara Holdings And Basic scientist were down about 7% and 6%, respectively.
Bitcoin falls below $98,000
These movements followed a sudden increase in 10-year US Treasury yield after data released by the Institute for Supply Management reflected faster-than-expected growth in the U.S. services sector in December, reinforcing concerns about higher inflation. Rising yields tend to put pressure on risky, growth-oriented assets.
Bitcoin traded above $102,000 on Monday and is expected to more than double this year from that level. Investors hope clearer regulation will support digital asset prices and in turn benefit stocks like Coinbase and Robin Hood.
However, uncertainty over the progress of the Federal Reserve’s interest rate cuts could hamper cryptocurrency prices. In December, the central bank signaled that even if it cut rates a third time, it could cut rates in 2025 less than investors had expected. Historically, rate cuts have had a positive effect on the price of bitcoin, while increases have had a negative impact.
Bitcoin is up more than 3% since the start of the year. It shows a gain of 120% for 2024.
