Bitcoin inched higher on Tuesday, recouping a small measure of recent losses on growing bets that U.S. interest rate cuts were imminent, although emerging doubts over a corporate treasury strategy kept gains limited and traders cautious.
Broader crypto prices gained some ground after logging steep losses in the beginning of September, although they largely lagged a rally seen in equities and gold. Crypto also appeared to be seeing little benefit from improving risk appetite, as markets bet on a September rate cut by the Federal Reserve.
Bitcoin rose 0.8% to $112,830 by 09:54 ET (13:54 GMT).
Bitcoin stalls amid crypto stock rout
Emerging doubts over the long-term returns on corporate Bitcoin buying crept into markets in recent weeks, especially following Bitcoin’s tumble from mid-August record highs.
Crypto markets showed middling reactions to the purchases of more Bitcoin by top corporate holders, including Strategy (formerly MicroStrategy (NASDAQ:MSTR)), and Metaplanet Inc (TYO:3350). Shares of the two also fell in recent sessions, headlining a broader decline in crypto-linked stocks.
The Bitcoin-buying strategy, successfully executed by Strategy over the past two years, makes a company’s shares much more vulnerable to swings in crypto prices. Critics were also seen questioning the long-term return potential of the strategy, given that it hinges entirely on Bitcoin’s price going higher, and could become diluted by more entrants to the sector.
Retail and institutional investors seeking equity exposure to Bitcoin can also just purchase spot exchange-traded funds, which were launched in U.S. markets last year.
Stablecoin operator Circle Internet Group Inc (NYSE:CRCL) slid to a near three-month low on Monday after Compass Point Research slashed the company’s price target and maintained its Sell rating. This was in face of heightened competition from decentralized exchange Hyperliquid’s announcement that it will launch its own stablecoin, USDH, to compete with USDC.
Hyperliquid holds about $5.4 billion in USDC deposits which it is now expected to convert into USDH. The figure represents about 8% of total USDC supply.
Nasdaq to invest $50mn in crypto exchange Gemini
In other crypto developments, Gemini, the cryptocurrency exchange founded by Cameron and Tyler Winklevoss, has lined up Nasdaq as a backer ahead of its planned IPO.
According to an amended S-1 filed with the SEC on Tuesday, Nasdaq agreed to purchase $50 million of Gemini’s Class A shares in a private placement at the IPO price, net of underwriting fees.
The partnership is expected to link Nasdaq’s clients to Gemini’s custody and staking services, while giving Gemini’s institutional users access to Nasdaq’s Calypso collateral management platform, Reuters reported on Tuesday.
The report noted the arrangement could still shift depending on market conditions.
Crypto price today: altcoins gain some ground
Broader crypto prices advanced on Tuesday after logging steep losses through late-August and early-September, although most of them remained rangebound.
World no.2 crypto Ether rose 0.4% to $4,354.85, while XRP rose 1.1% to $3.01.
Solana rose 2.2%, while Cardano rose around 3%.
Among meme tokens, Dogecoin jumped 4.4%, while $TRUMP rose 2.2%.
Crypto prices took some relief amid growing bets that the Federal Reserve will cut interest rates next week. Markets were pricing in a 90.1% chance for a 25 basis point cut during the Fed’s September 16-17 meeting, and a 9.9% chance for a 50 bps cut, CME Fedwatch showed.
Bets on rate cuts were driven chiefly by growing signs of a slowdown in the U.S. labor space.
U.S. inflation data due this week is expected to shed more light on the U.S. economy and interest rates. August’s data will be closely watched for any signs of upward price pressure from increased U.S. trade tariffs.
Source :
https://www.investing.com/news/cryptocurrency-news/bitcoin-price-today-recovers-to-near-112k-on-rate-cut-bets-but-caution-persists-4230480
