Weekly Crypto Review! Bitcoin’s Rollercoaster Week

This past week proved tumultuous for Bitcoin, as it oscillated near its all-time high only to suffer a significant dip, reflecting broader economic concerns and market reactions. Here is our Weekly crypto review!

From Peak to Trough

Bitcoin’s journey began on a high note, approaching a record peak with prices briefly touching $70,000 per coin on Coinbase. However, the momentum was short-lived, as the cryptocurrency saw a sharp decline, dropping more than 9% over the week to $61,358, with lows dipping to $60,704.

Economic Signals and Market Reactions

A major catalyst for the downturn was a disappointing U.S. jobs report, which fueled fears of an impending recession and triggered a sell-off on Wall Street. The financial turmoil was exacerbated by geopolitical tensions in the Middle East and fluctuating prediction markets, which now show a decreased likelihood of a Trump electoral victory. “Traders are pulling out of crypto investments,” explained David Lawant, head of research at FalconX.

Federal Reserve’s Optimistic Hint

In contrast to the market’s reaction, a mid-week meeting from the Federal Reserve provided a glimmer of hope. Jerome Powell, the Fed’s Chair, hinted at potential cuts to the historically high interest rates by September, a move that could ease some financial pressures.

A Strong Network Amidst Market Chaos

On a positive note, the Bitcoin mining difficulty reached an all-time high, indicating a robust and strengthening network, despite the market downturn.

Other Cryptocurrencies Also Face Declines

Ethereum and Solana, along with virtually all major cryptocurrencies, also experienced significant declines. Ethereum dropped by 8% to $2,963, while Solana saw a decrease of over 7% to $151. Meme coins, considered the riskiest assets, were particularly hard hit, with Dogwifhat plunging over 35% and Bonk by 22%.

Crypto Policy in Political Spotlight

Amid the market volatility, crypto policy remained a hot topic in Washington. Senator Cynthia Lummis (R-WY) introduced a bill to establish a national Bitcoin reserve. Meanwhile, former President Donald Trump, a Republican nominee, suggested an unconventional use of Bitcoin to address the federal government’s $35 trillion debt, though details of such a plan remain vague.

A Week of Highs and Lows

The past week encapsulates the volatile nature of cryptocurrency markets, influenced by economic indicators, geopolitical tensions, and political developments. As stakeholders look to the future, the intersection of economic policy and cryptocurrency remains a critical area of watch.