Markets
Cryptocurrency markets falter as Treasury rally produces assets under pressure
BlackRock’s IBIT surpassed GBTC to become the largest Bitcoin ETF with nearly $20 billion in assets.
Global markets traded lower on Wednesday as US Treasury yields rose for a second day, putting a lid on risky assets such as stocks and cryptocurrencies.
Bitcoin and Ether fell more than 1%, while Solana consolidated around the $170 level.
Meanwhile, memecoins are cooling down after a torrid week. BONK, FLOKI and PEPE recorded losses of between 8% and 10%, making them the biggest losers among the top 100 cryptocurrencies by market capitalization.
Rising Treasury yields often reflect expectations of tighter monetary policy from the Federal Reserve. If the market expects the Fed to raise interest rates to fight inflation, this can signal a slowdown in the economy, which is generally bad for risky assets.
Investors are already tempering their expectations for impending interest rate cuts. THE Fedwatch ECM The tool indicates a near certainty that rates will remain unchanged over the summer, with only a 42% chance of a reduction in September.
IBIT overturns GBTC
BlackRock’s IBIT is now the largest Bitcoin ETF in the world after overtaking Grayscale’s GBTC yesterday. IBIT holds more than 288,000 BTC, worth nearly $20 billion at current prices.
Bitcoin ETFs saw cumulative inflows of $45 million on Tuesday, with IBIT raising $102 million while GBTC lost $105 million in assets.