Bitcoin experienced a mixed performance during the first U.S. trading day of the week, ending in the green but giving up some gains as the U.S. 10-year yield spiked to its highest level in over 16 years. The world’s largest digital asset dipped into the red in the last 24 hours, falling by 1.57%. In contrast, the much-anticipated ether futures exchange-traded funds (ETFs) failed to attract investors’ interest, resulting in low trading volumes on their debut.
Bitcoin is set to close the U.S. trading day just below $28,000, representing a 3% increase, while ether is trading at approximately $1,670, down slightly for the session. In the equities market, stocks were mixed on Monday after U.S. lawmakers averted a government shutdown with a stop-gap bill.
Interest rates continued their upward trajectory, with the U.S. 10-year Treasury yield surging another 11 basis points to 4.69%. This increase occurred after unexpectedly strong manufacturing data underscored the resilience of the U.S. economy. The ISM figures came in at 49, surpassing the forecasted 47.7, which suggests that more rate hikes could be on the horizon.
The cryptocurrency market, particularly Bitcoin, has enjoyed a significant rally in recent times, driven by factors such as the SEC’s approval of ether futures ETFs and other government decisions. QCP Capital highlighted that Bitcoin’s value has risen by 15% in the last two weeks. However, the firm has expressed concerns about the sustainability of this rally, citing shifts in demand and historical data that indicate potential market downturns.
Michael Safai, Managing Partner at Dexterity Capital, recently stated on a TV appearance that “ETF issuers don’t know the markets like traders do. Their optimism is a bit misplaced; anyone who wants Bitcoin or ether surely has it.”
Impact of U.S. 10-Year Yield Spike on Bitcoin
The spike in the U.S. 10-year yield has had a noticeable effect on Bitcoin’s performance, causing it to relinquish some of its gains. As interest rates continue to rise, investors may become more cautious about investing in riskier assets such as cryptocurrencies. This could potentially lead to a decrease in demand for Bitcoin and other digital currencies, affecting their value.
Ether Futures ETFs Fail to Attract Interest
The launch of ether futures ETFs was highly anticipated by the cryptocurrency community, but the low trading volumes on their first day of trading indicate that they failed to capture investors’ attention. This lack of interest could be attributed to the fact that many investors who wanted to invest in Bitcoin or ether have already done so, as suggested by Michael Safai. As a result, the introduction of these ETFs may not have a significant impact on the cryptocurrency market.
Concerns Over Bitcoin Rally’s Sustainability
Despite the recent rally in Bitcoin’s value, concerns have been raised about its sustainability. Factors such as shifts in demand and historical data suggest that the market could experience downturns in the future. Investors should be cautious and monitor market trends closely to make informed decisions about their cryptocurrency investments.
In conclusion, Bitcoin’s performance during the first U.S. trading day of the week was a mixed bag, ending in the green but giving up some gains due to the spike in the U.S. 10-year yield. The launch of ether futures ETFs did not generate the expected interest from investors, and concerns about the sustainability of Bitcoin’s rally persist. As the cryptocurrency market continues to evolve, investors should stay informed and be prepared for potential market fluctuations.
