Ethereum
Cryptocurrencies suffer from tech stocks rout, ether falls 6%
- Disappointing quarterly results from Alphabet and Tesla late Tuesday weighed on the rest of the tech sector as investors shunned high-risk assets, including cryptocurrencies.
- With cryptocurrencies generally down, crypto-related stocks also declined.
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Cryptocurrencies fell a day after a reversal in technology stocks pushed the S&P 500 and Nasdaq Composite to their lowest levels. worst day since 2022.
Bitcoin The U.S. stock was down 2% at $64,603.34 on Thursday, according to Coin Metrics. Disappointing quarterly results from Alphabet and Tesla late Tuesday weighed on the rest of the tech sector as investors shunned higher-risk assets, including cryptocurrencies.
“It is clear that these challenges are more related to broader macroeconomic forces, with global financial markets in turmoil,” said Joel Kruger, market strategist at LMAX Group. “Concerns about the health and outlook for the global economy have intensified amid weaker economic data, declining U.S. earnings, and ineffective central bank accommodative measures. As a result, there has been nowhere to hide, with most major assets (currencies, commodities, and equities) moving to traditional safe havens.”
The market is also still plagued by a Mt. Gox’s ongoing repayment schedule which resulted in a a persistent series of selling pressures on bitcoin this month, he added.
In the meantime, ether fell 6% to $3,172.59 as the recently launched ether exchange-traded fund traded for a third day. Grayscale Ethereum Trust (ETHE)which converted to an ETF, saw $484 million in outflows in the previous session.
“What’s happening is the same as when bitcoin spot ETFs were launched in January,” said Yuya Hasegawa, a crypto market analyst at Japanese bitcoin exchange Bitbank. “Grayscale’s Ethereum fund was trading at [a] “ETFs have been at a discount for a long time, so traders may have bought some shares of the fund and are now selling spot ETH for arbitrage purposes – this is also what happened to bitcoin when ETFs first started trading.”
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Bitcoin and other cryptocurrencies are under pressure from the stock market’s tech rout
While bitcoin declined for a few weeks after the launch of bitcoin ETFs in January, ether ETF introductions are launching in a different market, and investors have some potentially positive news to look forward to that could give prices a boost, Hasegawa said.
Thursday marks the start of the Bitcoin 2024 conference, where investors are awaiting speeches from pro-bitcoin US politicians on both sides as well as Donald Trump. In addition, expectations of a Fed rate cut in September are rising.
With cryptocurrencies generally down, crypto-related stocks also declined. Coinbase fell by 3%, while MicroStrategies fell 2%. One of the most popular mining stocks, Iris Energy, lost 5%, while Riot Control Platforms fell by 3%.
Kruger called the cryptocurrency’s recent setbacks “a small blip in a strong uptrend,” noting that bitcoin and ether are up 51% and 38%, respectively, year-to-date, in contrast to the S&P 500’s 14% gain over the same period.