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Bitcoin slid toward $55,000 overnight, catching up with Tuesday’s broad market decline.
On Wednesday, the price of the flagship cryptocurrency was hovering above the flat line at $58,063.41, according to Coin Metrics. It fell sharply Tuesday night — to $55,673.80 — as Asia-Pacific trading began, but has since stabilized.
Bitcoin Falls Overnight But Stabilizes at $56,000
Technology stocks struggled Tuesday in the United States, with the sector coming off its worst day since September 2022, while two measures of manufacturing output showed signs of weakness, rekindling concerns about the health of the economy. Japan’s Nikkei 225 and Topix ended Wednesday with their worst one-day losses since the Aug. 5 plunge.
Bitcoin’s movements have been more muted than stocks’ during U.S. trading hours on major trading days lately. James Davies, co-founder of cryptocurrency trading platform Crypto Valley Exchange, said traders are reacting “more dynamically” to macroeconomic events during Asian trading.
“Cryptocurrency trading in the U.S. accounts for about 30% of global volume, but it is largely driven by institutional activity, particularly in derivatives products like CME futures, which are often less responsive to immediate market trends that they have seen coming,” he said. “In contrast, the Asian market, which contributes nearly 50% of global volume, is more retail-driven. Therefore, during Asian trading hours, bitcoin tends to react more actively to global financial movements, such as stock market fluctuations.”
August was a rough month for bitcoin and the poor trading performance could continue for another month. Analysts have warned that the cryptocurrency could fall back to $50,000 in September as traders wait for direction on US interest rate cuts and the upcoming presidential election.
September is historically the worst month for bitcoin. The cryptocurrency has only finished higher three times in the last 11 Septembers, and the month saw the cryptocurrency’s largest average loss of the year, at 4.8%, according to CoinGlass.
