Cryptocurrency Market Awaits Crucial U.S. Economic Data; Bitcoin and Ethereum See Marginal Changes

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WASHINGTON (dpa-AFX) – The sentiment in the cryptocurrency market remains noticeably subdued as investors and analysts alike eagerly await crucial updates on U.S. GDP growth and initial jobless claims. These data points are poised to significantly influence the Federal Reserve’s monetary policy outlook. Specifically, the second estimate of the U.S. GDP for the second quarter and the weekly data on initial jobless claims are set for release on Thursday morning.

In July, the U.S. Bureau of Economic Analysis had released advance estimates showing that the American economy expanded at an annualized rate of 2.8 percent in the second quarter, a notable increase from 1.4 percent in the first quarter and 3.4 percent in the fourth quarter of the previous fiscal year. This data is particularly significant given that global markets, including the cryptocurrency sector, experienced a sharp meltdown followed by a dramatic rebound in early August due to fears of a potential recessionary decline in the United States.

Markets are also keenly focused on updates regarding initial jobless claims for the week ending August 24, as they brace for a possible rate cut by the Fed in September. The number of individuals filing for unemployment benefits in the U.S. has remained steady at 232,000 for the past week, mirroring the figures from the week ending August 17. The numbers were slightly different for prior weeks, with 228,000 claims for the week ending August 10 and 234,000 for the week ending August 3. This data is a critical leading indicator of labor market conditions and holds substantial weight given Fed Chair Jerome Powell’s recent acknowledgment at the Jackson Hole symposium that the central bank’s focus has shifted towards addressing downside risks to employment rather than inflation.

In this backdrop of monetary policy uncertainty, the overall cryptocurrency market capitalization has dipped by 0.17 percent overnight to $2.1 trillion. The meme category within the crypto market saw a more pronounced decline of 0.50 percent, driven by losses in six of the nine top-ranked cryptocurrencies within the top 100. Dogecoin (DOGE), which holds the 8th position overall and is the highest-ranked meme crypto, recorded a slight overnight decline of 0.21 percent.

The AI & Big Data category experienced a significant overnight decline of 1.6 percent in market capitalization. This drop came amidst a decrease in NVIDIA’s share price despite the company surpassing earnings and guidance estimates. The dip in NVIDIA’s performance dampened the outlook for the broader tech sector and negatively impacted the AI segment within the crypto sphere. NEAR Protocol (NEAR), ranked 19th and considered the most valuable cryptocurrency in this category, saw its market capitalization decrease by over 2 percent within 24 hours.

The NFT & Collectibles category faced an even steeper decline of 2.6 percent in market capitalization overnight. This was largely influenced by OpenSea receiving a Wells Notice from the SEC, indicating potential enforcement action against the company. OpenSea is a leading non-fungible token marketplace where users can buy, sell, create, and trade NFTs. Artificial Superintelligence Alliance (FET), ranked 27th and leading in this category, plummeted by 9.6 percent overnight.

Bitcoin has seen a marginal decrease of 0.01 percent overnight, trading at $59,732.14, which is approximately 19 percent below its all-time high. Over the past week, Bitcoin has lost 2.4 percent, reducing its year-to-date gains to 41 percent. In the last 24 hours, Bitcoin traded within a range of $60,174.55 to $57,890.68.

Bitcoin Spot ETF products in the U.S. witnessed outflows amounting to $105 million, down from $127 million the previous day. Ark 21Shares Bitcoin ETF (ARKB) led these outflows for the second consecutive day, although outflows decreased to $59 million from Tuesday’s record outflows of $102 million. Interestingly, no ETF recorded net inflows on Wednesday.

Conversely, Ethereum gained 0.8 percent over the past 24 hours to trade at $2,545.18, which is around 48 percent below its previous peak. Weekly losses for Ethereum stand at close to 3.4 percent, while gains for 2024 are slightly over 11.5 percent. Over the past day, Ethereum traded between $2,558.80 and $2,457.87.

Surprisingly, Ether Spot ETF products rebounded with inflows of $5.9 million compared to outflows of $3.4 million the previous day. The last recorded net inflows were on August 14.

Other notable movements include BNB (BNB), ranked 4th, which edged down by 0.02 percent overnight to trade at $543.02; Solana (SOL), ranked 5th, which declined by 1.1 percent to $145.48; XRP (XRP), ranked 7th, which fell by 0.82 percent to trade at $0.5738; Dogecoin (DOGE), ranked 8th, which edged down by 0.21 percent to $0.1008; Toncoin (TON), ranked 9th, which rallied by 1.4 percent to $5.58; and TRON (TRX), ranked 10th, which edged up by 0.2 percent to $0.1597.

Among the top 100 cryptocurrencies, Helium (HNT), ranked 57th, recorded the highest overnight gains with a surge of over 10 percent. Conversely, DOGS (DOGS), ranked 80th, was the greatest laggard with an overnight decline exceeding 10 percent.

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