Aug 22 2024: Bitcoin’s price remained relatively unchanged on Friday as markets adopted a cautious approach ahead of Federal Reserve Chair Jerome Powell’s upcoming speech, which is expected to provide further insights into U.S. interest rate policy.
Amid a broader risk-off sentiment in financial markets, Bitcoin faced additional pressure from concerns over potential token distributions by the defunct Mt Gox exchange.
As of 01:56 ET (05:56 GMT), Bitcoin inched up by 0.2% to $60,846.8.
The crypto market also felt the impact of a sudden appreciation in the Japanese yen after Bank of Japan Governor Kazuo Ueda hinted at the possibility of further interest rate hikes. The yen’s strength had earlier unwound a carry trade in August, which negatively affected most risk-driven markets, including Bitcoin, which briefly dipped as low as $49,000.
Bitcoin Impacted by Mt Gox Concerns and Powell Speech Anticipation
For the week, Bitcoin was poised for a modest performance, with only brief moves above the $60,000 mark amid ongoing concerns related to Mt Gox. Wallets associated with the exchange reportedly mobilized nearly $3 billion worth of tokens this week, signaling potential further distributions.
The exchange began returning tokens, stolen during a 2014 hack, to clients in early July. This process has raised fears of a mass sale event, which could increase token supply and weigh on Bitcoin’s price.
A general risk-off move in financial markets further contributed to Bitcoin’s subdued performance, as Wall Street indexes closed lower on Thursday.
Market participants remained cautious ahead of Powell’s speech at the Jackson Hole Symposium later on Friday. Powell is expected to provide more direction on interest rates and the broader economy, with traders largely anticipating a rate cut in September. However, opinions are divided on whether the reduction will be 25 or 50 basis points, as indicated by CME FedWatch data.
