Crypto slips while stocks post a mild recovery after a rough start to 2024

Bitcoin and ether dipped Friday, losing 1.5% and 1.7%, respectively, while stocks posted a modest recovery not high enough to turn this week around

article-image

愚木混株 cdd20/Unsplash modified by Blockworks

share

Bitcoin and ether slipped Friday, losing 1.5% and 1.7%, respectively, after a tumultuous week in crypto markets. Meanwhile, stocks, after a rocky start to 2024, started to turn things around, but indexes are still on track to post their first losing week in more than two months. 

The S&P 500 and Nasdaq Composite indexes each gained around 0.3% toward the end of Friday’s trading session, positioning them 1% and 2.4% lower, respectively, since the beginning of the year. 

Investors have been digesting this week’s jobs data and the latest indication from the Federal Reserve that the pace and timeline for rate cuts is still very much up in the air. The ratio of job openings to unemployed workers remained at 1.4x in November versus the average of 0.7x since December 2000, according to data from the Bureau of Labor Statistics released Wednesday. 

“Whether it was just exuberant festive cheer or something more, investors bounced into the end of 2023 full of hope that not only is the tightening cycle behind us, but 2024 will be the year of the soft landing and more rate cuts than you can count on one hand,” Craig Erlam, senior market analyst at Oanda, said of the late 2023 rally in stocks. 

“That may be proven to be correct, perhaps even not bullish enough, but it was going to be tough to sustain that positioning and build upon it early in the new year,” Erlam added. “We effectively needed all of the economic indicators to fall kindly from the off which was a big ask.”

Read more: Bitcoin is trading on ETF news, but analysts caution on macro headwinds 

Bitcoin (BTC) on Friday hovered under $44,000, erasing the mild recovery from Thursday that saw the crypto bounce as much as 4% to trade at around $44,500. 

Ether (ETH) similarly declined Friday, losing 1.5% and dipping to trade 2% lower since the start of 2024. Bitcoin remains up 2.7% year-to-date. 

On Wednesday, bitcoin slipped 8% in a matter of hours, spurred, analysts say, by skepticism that a bitcoin spot exchange-traded fund will make it past the SEC this month

Researchers from financial services platform Matrixport predicted Wednesday morning that the “dominated by Democrats” SEC voting group would follow chair Gary Genseler’s lead and elect not to embrace crypto. Traders seemed to sell on the news, but bitcoin was back around $44,500 by Thursday. 

Read more: Bitcoin ETF tweets and Vitalik’s car crash: How news real and fake moves crypto prices

Two issuers on Thursday indicated that their respective exchanges had approved their ETF listing, pending SEC approval, another step in the right direction, ETF analysts say. 

Grayscale, which plans to list on NYSE Arca if and when the SEC approves the product, and VanEck, which could debut on Cboe, on Thursday filed their 8-a forms, a requirement before securities are listed. 

The SEC has until Jan. 10 to approve or deny Ark and 21Share’s bitcoin ETF application. It’s a deadline traders and analysts have been keeping a close eye on, but the following weeks could see a return of macroeconomic-driven market moves for bitcoin, Noelle Acheson, author of the ‘Crypto is Macro Now’ newsletter, said. 

“Macro matters are not the driver of bitcoin narratives at the moment. Will that change?” Acheson said. “Perhaps, especially if we see a ‘sell-the-news’ correction after the BTC spot ETFs are approved. Bitcoin is and probably always will be influenced by monetary liquidity and overall investor sentiment.”


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the On the Margin newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2024

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Polygon Call Template (2).png

Research

A significant portion of the call was dedicated to discussing the proposed ZK-PoS Phase 1, which aims to connect Polygon PoS to the AggLayer using a ZK proof of consensus, in addition to a pessimistic proof. This upgrade is intended to generalize how chains settle while protecting chain health and asset integrity. The implementation will involve deploying new contracts for the LxLy unified bridge for token mapping and migrating existing tokens from the PoS portal to the new deployment.

article-image

It may be counterintuitive that a high amount of focus on a technology would lead to security risks — but it’s true

article-image

Structured products are common in traditional finance, but onchain options are scant

article-image

Plus, an update on the ether ETF front and an overview of this week’s economic calendar

article-image

Plus, Solana fell roughly 12% on the week, and for some memecoins the drawdown was even more aggressive

article-image

Mark Wong is currently seeing some profit-taking from early bitcoin adopters, but he also sees buying interest from institutions

article-image

Bitcoin has been in a bull market for 19 months. If March wasn’t the top, that is.