Bitcoin Barely Holds $29K Alongside Sizable Altcoin Selloff

Interest rates continue to move higher across the globe, putting pressure on risk assets.

AccessTimeIconAug 2, 2023 at 10:33 p.m. UTC
Updated Aug 3, 2023 at 1:20 p.m. UTC
  • Bitcoin is down 1.3% Thursday morning to $29,070 as XRP, ADA, SOL and DOGE all decline nearly 5%.
  • An overnight intervention by the Bank of Japan failed to stop the 10-year Japanese Government Bond yield from rising to a fresh nine-year high.

Cryptocurrency markets are selling off during U.S. morning hours Thursday, with the CoinDesk Market Index (CMI) off 1.3%, led by a 1.3% decline in bitcoin (BTC) and near-5% drops for altcoins like Ripple's (XRP), Solana's (SOL), Cardano's (ADA) and Dogecoin (DOGE).

Fears of a continued surge in G7 interest rates are as good of an excuse as any for today's selloff. The Bank of Japan (BOJ) overnight was forced to step into the markets for the second time this week to try and arrest rising yields. The move may have helped somewhat, but didn't stop the yield on the 10-year Japanese Government Bond (JGB) from moving to about a nine-year high of 0.65%.

Yields are higher across Europe as well, and the 10-year U.S. Treasury yield is up 8.75% basis points to 4.175%, its highest level of 2023. Billionaire hedge funder Bill Ackman overnight said he's short long-dated U.S. bonds "in size," and that we could soon see more than another 100 basis point rise in yields.

In the U.K., the Bank of England (BOE), as expected, hiked its benchmark lending rate by 25 basis points to a 15-year high of 5.25%.

Rising rates are hitting traditional markets as well, with U.S. stock index futures showing declines of about 0.5% across the major averages, adding to yesterday's big selloff. Europe is down 0.8% at midday.

Larger moves ahead?

In an email to CoinDesk, Jeff Feng, co-founder of Sei Labs, noted the swirl of recent news, including multiple applications for spot bitcoin and ether ETFs, that are figuring in the crypto market's fluctuations and could lead to even larger price changes.

“We're seeing a multitude of influential factors at play, which includes corporate investments, regulatory advancements, macroeconomic shifts, and potential for increased accessibility through financial products like ETFs," Feng wrote. "MicroStrategy's continued investment in Bitcoin certainly underscores their commitment, helping solidify corporate interest in digital assets. This, in tandem with anticipation around the upcoming Bitcoin halving event, is influencing market behavior, as traders often view such milestones as potential catalysts."

He added: "These periods that may seem range-bound could indeed be precursors to more substantial market movements. Staying informed about...multifaceted influences is key for any market participant, from individual traders to institutional investors.”

Edited by James Rubin and Stephen Alpher.


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James Rubin

James Rubin was CoinDesk's U.S. news editor based on the West Coast.

Stephen  Alpher

Stephen Alpher is CoinDesk's managing editor for Markets. He holds BTC above CoinDesk’s disclosure threshold of $1,000.