Bitcoin and Crypto Market Update
The recent rally in bitcoin (BTC) and the broader cryptocurrency market, triggered by a weekend panic related to tariffs, has proved to be short-lived. As the U.S. trading day came to a close, bitcoin experienced a decline of 4.8% over the past 24 hours, settling at $96,900. This drop follows a brief surge that saw the cryptocurrency reaching around $101,000 just two hours earlier.
Many altcoins faced even steeper declines, with notable cryptocurrencies such as Solana (SOL), XRP, Cardano (ADA), and Chainlink (LINK) experiencing losses ranging from 6% to 10%. Additionally, Ethereum (ETH) saw a decrease of 5.3%.
The onset of the decline appeared to coincide with a press conference focused on cryptocurrency, held by David Sacks, the White House crypto and AI czar. He was accompanied by leaders of key Senate and House committees. There was anticipation that the press conference might explore the potential for establishing a strategic bitcoin reserve. However, expectations were unmet as the majority of the discussion revolved around regulatory issues and general statements.
Bitcoin was mentioned towards the end of the conference when Sacks responded to a question about the White House’s intentions regarding a strategic bitcoin reserve. He indicated that a working group focused on crypto is actively assessing the feasibility of such a reserve. When pressed for insights on how yesterday’s executive order concerning the creation of a sovereign wealth fund might impact bitcoin, Sacks redirected the question to Commerce Secretary nominee Howard Lutnick, who, along with Treasury Secretary Scott Bessent, is set to lead the sovereign wealth fund initiative.
Looking ahead, it seems bitcoin may be gearing up for another test of its lowest point from Sunday evening, which dipped below the $92,000 mark. Market participants are keenly awaiting Friday’s U.S. January employment report, as its implications could be significant. A weaker employment report could encourage traders to factor in potential Federal Reserve rate cuts, potentially providing a boost to bitcoin and other cryptocurrencies. Conversely, a stronger employment figure might lead investors to anticipate a rate hike at some point this year, which could act as a headwind for prices, absent other influencing factors.
