Original title: Crypto Markets Slide as Inflation Concerns Resurface
Original author: Mehab Qureshi
Original source: https://thedefiant.io/
Compiled by: Mars Finance, Daisy
Crypto markets fall as inflation concerns resurface.
Concerns are also growing that the U.S. government may sell 69,370 bitcoins seized from the Silk Road marketplace.
Crypto markets took a hit on Thursday as volatility mounted amid concerns about inflation and news that the U.S. government could sell billions of dollars in bitcoin.
Bitcoin (BTC) fell 2.7% to $60,500, while Ethereum (ETH) fell 1.4% to $2,394. Other major cryptocurrencies such as Solana (SOL) and Polkadot (DOT) also slipped, falling 3.7% and 1.5%, respectively.
BTC Price
Concerns are growing about the U.S. government's potential sale of 69,370 bitcoins seized from the Silk Road marketplace, with traders worried that a sale of the haul, worth about $4.4 billion at current prices, could disrupt the market.
On October 8, the U.S. Supreme Court rejected an appeal regarding the ownership of the bitcoins, effectively clearing the way for the government to auction them off. The decision upheld a 2022 ruling that allowed the U.S. to sell the seized assets, raising concerns about how such sales would be handled and their impact on bitcoin prices.
Ryan Lee, chief analyst at Bitget Research, said large-scale Bitcoin sales usually trigger market fluctuations.
"If sold all at once or in a short period of time, the sudden increase in supply could dampen market sentiment, leading to a sell-off and causing a short-term drop in Bitcoin prices," Lee said.
He added that some investors may adjust their positions in advance to avoid risks, exacerbating short-term volatility. "Some investors may be concerned that the influx of these bitcoins will put downward pressure on prices, especially when sold on the open market."
The overall crypto market has been hit by risk aversion. According to CoinGlass data, about 66,000 traders were forced to close their positions in the past 24 hours, with a total liquidation amount of $184 million.
CPI exceeds expectations
In the United States, the latest Consumer Price Index (CPI) report showed that prices rose 2.4% annualized in September. Economists surveyed by Dow Jones had expected a 2.3% increase. This data may play a key role in the Federal Reserve's interest rate decision in November.
Meanwhile, the U.S. Dollar Index (DXY) rose to 102.97, reaching its highest level since mid-August. A strong dollar tends to put downward pressure on cryptocurrency prices as it makes dollar-denominated assets, such as Bitcoin, less attractive to investors.
In addition, Producer Price Index (PPI) data and earnings reports from major banks such as JPMorgan Chase and Wells Fargo will provide more information for assessing the health of the U.S. economy.
U.S. stocks were lackluster on Thursday. The Dow Jones Industrial Average fell 0.2%, while the S&P 500 and Nasdaq fluctuated between small gains and losses.
