30s Summary

Bitcoin’s value surged past $68,400 on Oct. 16, but failed to sustain this and is now trading below $67,500. This is attributed to good economic news from the US weakening enthusiasm for alternative investments like Bitcoin. The strong performance of the US economy and impressive third-quarter results from Taiwan Semiconductor have drawn traders’ attention to the stock market. However, optimism has begun to grow surrounding the Biden-Harris adminstration’s positive stance towards cryptocurrency. Further, a possible favourable verdict for Ripple in a case with the US Securities and Exchange Commission (SEC) could bolster Bitcoin’s bullish momentum.

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Bitcoin’s value briefly went past $68,400 on Oct. 16, the highest since August. However, it could not hold on to this value and is currently trading below $67,500. Investors now wonder if Bitcoin can get back on its winning streak.

Nonetheless, good economic news from America seems to have dampened the enthusiasm for alternative investments like Bitcoin. TSMC also presented a strong earnings report which drew traders’ attention away from Bitcoin and towards the stock market.

Bitcoin’s inability to sustain its value above $68,000 can be partly attributed to the current economic conditions. Nonetheless, optimism about the Biden-Harris administration’s friendly attitude towards cryptocurrency have started to emerge.

The US economy’s robust performance could negatively affect Bitcoin’s value. As per reports on Oct. 17 from the US Labor Department, jobless claims dropped by 19,000 in the week ending Oct. 12. An indication of fewer corporate layoffs, suggesting that the economy is in a decent state. An announcement by the Census Bureau of the US Commerce Department also stated that retail sales had inched up by 0.4% in August as compared to the previous month.

Jonathan Millar, a top economist at Barclays, said on Yahoo Finance that a loop of strong consumer spending, net hiring, and payroll income is generating a positive cycle during this economic expansion. An increase in spending is typically seen as a positive for corporate earnings, which makes the stock market a better investment than Bitcoin.

As per reports, the S&P 500 gains on Oct. 17 were driven by Nvidia, whose share price went up by 3% to touch a new high. This was helped by gains from Taiwan Semiconductor (TSMC), a big AI chip maker, which posted impressive third-quarter results and increases their revenue forecast for 2024. Their shares jumped 13%, attracting investors and capital.

Some believe that Bitcoin competes directly with tech stocks, and its value comes from risk-on trades. Investors aim for returns in sectors that are expected to benefit from increased market liquidity. This has become more noticeable as Bitcoin spot exchange-traded funds (ETFs) have exceeded $50 billion in assets under management.

The happening that could indicate a favorable regulatory approach towards cryptocurrency from the Biden administration is if Ripple wins in court. Ripple might ask for a resolution in its favor, if the US Securities and Exchange Commission (SEC) misses the deadline to file its appeal brief. The SEC claims that Ripple violated federal securities laws by selling its XRP tokens without registering them. However, others suggest that the SEC made its appeal on Oct. 2, which made the deadline for the brief Oct. 18.

Although the economy’s stronger-than-expected performance is not optimal for Bitcoin’s short-term price, the SEC’s loss to Ripple might be seen in a positive light, reigniting Bitcoin’s bullish momentum.

Source: Cointelegraph