As a seasoned crypto investor with a decade of experience navigating the volatile digital asset market, I find myself intrigued by the recent surge in altcoins, particularly those focused on artificial intelligence like Bittensor’s TAO and Render’s RNDR. The strong performance of these tokens is not just a fluke; it’s a testament to the growing potential of AI in the digital age.
On Fridays, alternative digital currencies, often called altcoins, surged ahead in the market as geopolitical concerns lessened and a strong U.S. employment report eased worries about an impending recession.
Over the last 24 hours, tokens associated with AI-centric protocol Bittensor’s {{TAO}} and Render (RNDR) surged by 14% and 8%, respectively. Notably, the CoinDesk Computing Index, which monitors various AI-related tokens, experienced the most significant growth among all crypto sectors.
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Throughout U.S. trading hours, Bitcoin gradually increased to reach $62,300, marking a 2.2% growth for the day. Meanwhile, the comprehensive crypto index managed by Coindesk (the Coindesk 20 Index) experienced a more significant surge of 4.2%, suggesting that alternative cryptocurrencies performed better than Bitcoin during this time frame.
It’s possible that the unexpectedly strong U.S. labor market report from September could be the reason behind the move. This report added a whopping 251,000 jobs, significantly exceeding predictions for 140,000 new jobs. The unemployment rate also dropped to 4.1%, easing worries about an impending recession.
The positive sentiment rippled through the stock market as well, with the S&P 500 and Nasdaq indexes closing the day 0.9% and 1.2% higher, respecitvely. The U.S. 10-year Treasury bond yield jumped 13 basis points to just shy of 4%, while the U.S. dollar index rose to its strongest level since mid-August. Following the report, investors now overwhelmingly expect a smaller 25 basis point interest cut from the Federal Reserve in November.
Leena ElDeeb, a research analyst at digital asset manager 21Shares, explained that Bitcoin and other cryptocurrencies can be influenced by employment data. This is because changes in employment affect the Federal Reserve’s decisions about interest rate reductions. Lower interest rates make borrowing cheaper, which can boost Bitcoin’s value. Additionally, ElDeeb predicted that investment flows into cryptos may improve after a week of geopolitical turmoil.
Bitcoin bottom likely in
As a researcher, I find myself in agreement with Markus Thielen, the founder of 10x Research, who posits that the recent sell-off in early October might have reached its conclusion. In the ensuing weeks, I anticipate prices to steadily climb higher.
If the U.S. economy continues to be robust, there’s potential for both stocks and cryptocurrencies to increase, according to Thielen.
According to Clemente, who established Reflexivity Research, the Federal Reserve loosening its monetary policy in a robust economy is likely to be favorable for Bitcoin following this week’s reduction in leveraged positions.
As an analyst, I stated in a recent post that individuals had liquidated their positions due to excessive leveraging or being misled by the recurring Iran tensions. Now, with this morning’s robust jobs report, the economy has been confirmed as strong. We’ve just entered a global easing cycle, and this latest event seems to have provided a readjustment in market positions.
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2024-10-04 23:53