Bitcoin, the Oldest Cryptocurrency, Came Under Pressure on Tuesday Following the Release of US Inflation Data. However, the Turbulence Did Not Go Unnoticed for Long, as a Counter-Movement Began Shortly Thereafter. Crypto Stocks from Marathon Digital, MicroStrategy, and Coinbase Were Among the Beneficiaries.
Bitcoin's Reaction to Recent US Inflation Data for January Was Clear: Sharp Losses. The figures indicated persistent inflation, which dashed expectations of an impending US Federal Reserve interest rate cut. In line with steep declines in international stock markets, the Bitcoin price temporarily fell below the closely watched mark of 50,000 US dollars, which it had just surpassed again on Monday for the first time since the end of 2021.
Over the past few months, cryptocurrency has increasingly garnered investor interest and has continuously achieved significant milestones. Positive news for the industry was also the approval of Bitcoin ETFs in the USA by the Securities and Exchange Commission (SEC) in early January of this year. This move made it easier for investors to invest in Bitcoin without having to purchase digital coins themselves.
The Bitcoin price crash also adversely affected numerous crypto stocks. Thus, the stock of the crypto mining company Marathon Digital recorded a loss of 5.72 percent to 25.72 US dollars, the crypto exchange Coinbase lost 4.7 percent to 140.39 US dollars, and the tech company MicroStrategy, which pursues an aggressive Bitcoin investment strategy, fell 4.39 percent to 686.02 US dollars at the close of trading.
Crypto Investors Return to the Market Shortly After Selling Pressure on Bitcoin
But shortly after the selling pressure on Bitcoin, crypto investors returned to the market. In Wednesday's trading, the digital currency not only reclaimed the $50,000 mark but even rose to over $51,700 on the Bitstamp trading platform – the highest level since the end of 2021. According to Timo Emden from the German Press Agency, investors were able to successfully shake off the interest rate worries from the previous day.
And there is also a turning point to be seen in NASDAQ trading for the battered crypto stocks. The Marathon Digital stock temporarily rose by 12.21 percent to 28.86 US dollars, the Coinbase stock gained 8.45 percent to 152.25 US dollars, and the MicroStrategy security increased by 9.23 percent to 749.31 US dollars.
For Coinbase investors, tomorrow evening will be particularly exciting when the company releases its latest figures after the market closes. Analysts estimate that revenue last quarter may have surged a hefty 31 percent to $826.1 million. Furthermore, it is expected that the cryptocurrency exchange will move from a loss to a profit zone, reporting an EPS of $0.022. Experts also predict lower revenues and losses for the entire fiscal year.
