Bitcoin experienced a sharp decline on Thursday, reaching levels not seen in over six months, as investors reduced exposure to riskier assets. This move comes amid speculation about another potential Federal Reserve rate cut next month.
The prominent digital currency dropped to $86,325.81 at its lowest, marking its weakest price point since April 21, before recovering slightly to $86,690.11.
Stronger-than-anticipated U.S. jobs data, showing the economy added 119,000 jobs in Septemberâsignificantly surpassing the 50,000 new positions foreseen by economists surveyed by Dow Jonesâprompted uncertainty regarding the central bank's decision on lowering its benchmark overnight rate.
This unexpected jobs report led to a decrease in the likelihood of a December rate cut, placing the probability at roughly 40%, based on CME Group's FedWatch tool.
Bitcoin's decline was part of a wider downturn in the cryptocurrency market, with other digital assets also experiencing losses. XRP was down 2.3% on the day, dipping below $2.00, while ether fell over 3% to trade significantly under $3,000. In contrast, Dogecoin remained unchanged.
Additionally, the downturn in Bitcoin affected the stock market, despite a substantial earnings report from Nvidia. Traders with heavy investments in AI-related stocks tend to hold Bitcoin as well, intertwining their market movements.
Bitcoin's price has generally been sliding since a series of cascading liquidations of highly leveraged crypto positions occurred in early October.