Investing.com-- Bitcoin price remained relatively stable on Friday as investors exercised caution ahead of Federal Reserve Chair Jerome Powell's upcoming speech on U.S. interest rates.
A general aversion to risk in financial markets put pressure on the cryptocurrency sector, with Bitcoin also facing downward pressure due to concerns about potential token distributions by the now-defunct exchange Mt Gox. Bitcoin inched up by 0.2% to reach $60,846.8 by 01:56 ET (05:56 GMT).
The crypto market was further spooked by a significant strengthening in the Japanese yen, following comments from Bank of Japan Governor Kazuo Ueda suggesting a potential rise in interest rates. This appreciation in the yen led to the unwinding of carry trades in early August, causing a negative impact on most risk-driven markets, including Bitcoin which dropped to as low as $49,000.
Bitcoin's Performance Affected by Mt Gox Concerns and Powell's Speech Expectations
Bitcoin was on track for a lackluster weekly performance, with the token struggling to sustain breaks above the $60,000 mark amidst ongoing worries related to Mt Gox.
Reports indicated that wallets linked to the exchange had moved nearly $3 billion worth of tokens this week, hinting at the possibility of more distributions. This followed Mt Gox's initiative to return stolen tokens from a 2014 hack to its clients in July, raising concerns of a potential flood of tokens into the market and subsequent selling pressure on Bitcoin.
Adding to the cautious sentiment in the market, Wall Street indexes closed lower on Thursday. Investors were anticipating Powell's speech at the Jackson Hole Symposium, with expectations for further insights on interest rates and the overall economy. Market participants are currently divided on the potential size of a rate cut in September, with some leaning towards a 25 basis point reduction while others consider a 50 basis point cut.
Weak labor market data released earlier in the week has fueled arguments in favor of a deeper rate cut, although concerns have also been raised about the impact of a weakening labor market on economic growth.
Cryptocurrency Prices Today: Altcoins Show Modest Gains Amid Mixed Weekly Performance
Despite a slight uptick in broader cryptocurrency prices on Friday, the market was heading towards a mixed weekly performance after a failed attempt to recover from losses experienced earlier in August.
Ethereum, the second-largest token, rose by 1.8% to reach $2,674.99, while other altcoins such as Litecoin, Ripple, and Cardano posted gains ranging from 0.9% to 2.1%. However, Binance Coin lagged behind, dropping by 0.1%. Dogecoin, a popular memecoin, saw an increase of 1.2% in its price.
Overall, the cryptocurrency market remains volatile and influenced by various factors such as market sentiment, regulatory developments, and macroeconomic indicators. Investors should closely monitor these factors and stay informed to make well-informed decisions regarding their investments.