Stocks, Cryptos Falter on Jobs Data, Binance Hack Fallout

Bitcoin down 2%, ether falling 1.5%, the S&P 500 and tech-heavy Nasdaq losing 2% and 3% respectively

article-image

Blockworks Exclusive Art by Axel Rangel

share

key takeaways

  • Crypto’s rally earlier in the week proved to be short lived
  • Jobs data and fears over the latest crypto hack had investors weary

Even after hints earlier in the week that a turnaround was coming, cryptocurrencies and equities are lined up to end another week in the red following jobs data that suggests rising interest rates will likely continue and ongoing turmoil in the digital asset space. 

It was a sea of red across the board midway through the trading session Friday. Bitcoin and ether lost 2% and 1.5%, respectively. The S&P 500 and tech-heavy Nasdaq posted 2% and 3% losses, respectively. 

Macroeconomic data and further trouble in the crypto world contributed to the decline, analysts said. Cryptos were already suffering from widespread volatility in equity markets, fueled by increasing inflation, calls for central banks to pivot and fret over how high interest rates might go.

News of a hack on Binance’s BNB Chain, coupled with positive news on the labor front and a strong US dollar, put an end to crypto’s slight rally earlier in the week. 

BNB Chain noted on Twitter that it had paused its network, sending the price of Binance Coin (BNB) lower. The cryptoasset traded for as little as $279 by 7:50 pm ET. By Friday afternoon, the price had recovered to around $282, according to data compiled by Blockworks.

“BNB dropped less than 5%,” Changpeng Zhao, often known as CZ, said Friday morning during an appearance on CNBC’s Squawk Box. CZ added that his team has now minimized the damage to “less than $100 million.” 

On the macro side, Friday’s jobs data showed that unemployment fell to 3.5% in September, down from 3.7% in August. It’s a sign traders took to mean a Federal Reserve pivot is a long way off, Craig Erlam, senior market analyst at Oanda, said.

“Even earlier in the week when equity markets were rallying strongly, there was always a sense that the jobs report could spoil the party,” Erlam said. “And not because it could point to cracks appearing in the labor market, quite the opposite in fact.”

The market seems to be thinking that poor economic data, such as rising unemployment or poor manufacturing PMI, as seen on Tuesday, will leave the Fed with no choice but to back off its rate raising policy. 

“The labor market until now has been very resilient and while cracks appearing will get the attention of the central bank, it will take much more than that to force it to slow down,” Erlam said. “What’s more, without inflation indicators consistently pointing to lower price growth, policymakers will be hesitant to ease up sooner.” 

The central bank’s next policy meeting is scheduled for November.


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

Research Report Templates.png

Research

ZKPs enable efficient offchain transaction processing and validation, resulting in increased throughput and reduced fees. Solana's ZK Compression leverages ZKPs to minimize onchain storage costs, while Sui's zkLogin streamlines user onboarding by replacing complex key management with familiar OAuth credentials.

article-image

Mt. Gox creditors are finally getting their bitcoin back — even if it’s only one click away from being sold

article-image

Plus, is Polymarket this cycle’s breakthrough mainstream app?

article-image

The crypto asset manager lowered its planned fee from 0.25% to 0.15%, undercutting its competitors

article-image

Plus, a look at planned ETH ETF fees and how they differ from their BTC counterparts

article-image

North Korea suspected in breach of Indian exchange’s multisig wallet

article-image

Plus, Sanctum’s CLOUD token has officially launched — but not without problems