Bitcoin Slumps to $25.5K, With Price Now Probing August Low

A modestly softer-than-expected employment report Friday morning failed to provide a positive catalyst.

AccessTimeIconAug 31, 2023 at 8:07 a.m. UTC
Updated Sep 1, 2023 at 7:47 p.m. UTC
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The price of bitcoin (BTC) Friday afternoon slid to as weak as $25,370, nearly matching the low hit during the panicky selloff on August 17. A modest bounce has brought the price back to $25,600 at press time, down another 2% today to add to Thursday's 4% decline.

The headline number in Friday morning's job report from the U.S. government topped expectations, with 187,000 jobs added versus forecasts for 170,000. July's job gains, however, were revised lower to 157,000 from an originally reported 187,000 and June's numbers were downwardly revised as well. The unemployment rate in August jumped to 3.8% against expectations for 3.5% and 3.5% in July. In addition, wage growth was modestly weaker than expected in August.

Added up, it's fair to say the employment situation is softer than previously thought, but only modestly so. Today's new figures might mean the U.S. Federal Reserve can remain on hold with monetary policy for a bit longer, but it's not going to have the central bankers in a rush to begin easing interest rates.

With today's decline, bitcoin has tumbled about 9% since spiking higher to $28,100 on Tuesday following investment fund manager Grayscale's court victory over the U.S. Securities and Exchange Commission (SEC) in that company's bid for a spot bitcoin ETF.

The broader CoinDesk Market Index (CMI) is lower by 2.1% over the past 24 hours.

Crypto markets likely to remain under pressure

"I continue to expect a gradual sell-off in BTC for the next one [to] two months," John Glover, chief investment officer at crypto lender Ledn, wrote in an email.

"Once the final [ETF] approvals are in place this will be very bullish for BTC, and for all digital assets," he said of the court decision. "However, until then, market fundamentals that are impacting all risk assets and technicals will be the main drivers for the near term."

"Both of those are negative in my view," Glover added.

Crypto asset trading firm QCP Capitals forecasted bitcoin prices sinking to $23,000 to $24,000 in September in a Telegram market update.

"We would likely still start Q4 near the lows as optimism on the spot ETF again fade into the backdrop with more can-kicking from the SEC side, and lack of innovation in the sector as compared to other tech sectors," the firm said, adding that a glut of supply expected next month, from a payout to creditors of the failed Mt Gox bitcoin exchange, "will provide short-term bearish flow pressure to come."

Edited by Sheldon Reback, Nick Baker, Marc Hochstein and Stephen Alpher.

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Shaurya Malwa

Shaurya is the Deputy Managing Editor for the Data & Tokens team, focusing on decentralized finance, markets, on-chain data, and governance across all major and minor blockchains.

Krisztian  Sandor

Krisztian Sandor is a reporter on the U.S. markets team focusing on stablecoins and institutional investment. He holds BTC and ETH.

Stephen  Alpher

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


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