Cryptos Slide As Jobs Data Dashes Hopes Of A Quick Fed Pivot

Cryptocurrencies declined more than 1 percent in the 24 hours amidst negative sentiment following economic data releases from the U.S. on Friday that implied a resilient U.S. economy and a likely continuation of the tight monetary policy.

Data released by the U.S. Bureau of Labor Statistics had showed an addition of 517 thousand non-farm payrolls in the month of January. Markets were expecting a reading of 185 thousand versus the previous month’s reading of 260 thousand. The unemployment rate dropped to 3.4 percent from 3.5 percent earlier. Markets had anticipated it to rise to 3.6 percent. The Non-manufacturing PMI data also surged more than expected to the expansion zone.

The anxiety surrounding the jobs data stems from its impact on inflation. Historically inflation and unemployment are inversely related and a drop in unemployment could imply people spend more, leading to more pressure on prices. The strength of the labor market therefore restricts the leeway available to the Fed to slow down on interest rate hikes.

Amidst renewed Fed-fears and the recent spurt in geopolitical tensions, the Dollar Index, a measure of the Dollar’s strength against a basket of 6 currencies has strengthened to 103.43 from Thursday’s low of 100.82. The strength of the Dollar has dampened the dollar-denominated prices of cryptocurrencies.

Overall crypto market capitalization is currently at $1.06 trillion, from the level of $1.08 trillion early on Friday.

The crypto market cap is now constituted 41.5 percent by Bitcoin, 18.8 percent by Ethereum, 13 percent by stablecoins and 26.7 percent by the residual altcoins.
Bitcoin’s market dominance dropped from 41.9 percent whereas Ethereum decreased market share from 18.7 percent prevailing early on Friday.

Bitcoin has shed 1.6 percent on an overnight basis and 1.5 percent on a weekly basis to trade at $22,842.27. BTC is however holding on to gains of 37 percent on a year-to-date basis.

Ethereum also shed 1.4 percent in the past 24 hours and is currently changing hands at $1,628.57. Ether is holding on to gains of 2.7 percent in the past week and 36 percent on a year-to date basis.

46th ranked The Graph (GRT) rallied more than 14 percent overnight. 93rd ranked Magic (MAGIC) added more than 12 percent. 83rd ranked Render Token (RNDR) gained 11.5 percent whereas 59th ranked Frax Share (FXS) strengthened 9.4 percent in the past 24 hours.

40th ranked Fantom (FTM) and 58th ranked Bitcoin SV (BSV) have both declined more than 4 percent in the past 24 hours.

26th ranked OKB (OKB) is the highest-ranking cryptocurrency (excluding stablecoins) to trade in the overnight green zone. OKB has gained 1.3 percent overnight, 16.7 percent in the past week and 60.2 percent on a year-to-date basis.

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