Global markets faced a broad sell-off, affecting everything from U.S. stocks to Japanese indexes and seeping into the cryptocurrency market. Bitcoin (BTC) saw a reversal of losses during Asian morning hours on Friday, as geopolitical tensions in the Middle East and concerns about the U.S. economy contributed to market volatility.
BTC fell to a low of $62,500 during late U.S. trading hours on Thursday but rebounded to trade just under $64,000 at 6:30 UTC. This placed it near its 50-day moving average, a key support level for many traders. FxPro senior market analyst Alex Kuptsikevich noted that if Bitcoin’s decline continues, the $63,000 and $61,000 levels will be critical. “A failure of this support will open the way to $55K, which is quite frightening,” Kuptsikevich said in an email to CoinDesk.
Kuptsikevich also pointed out that August has historically been a challenging month for Bitcoin, with the cryptocurrency ending the month down eight times and up only five times over the past 13 years. The average decline has been 15.4%, while the average increase has been 26%.
Other major cryptocurrencies also experienced losses. Ether (ETH) fell 1.6% in the past 24 hours, while XRP and Solana’s SOL dropped as much as 8%. The broad-based CoinDesk 20 (CD20) index, which tracks the largest tokens by market capitalization minus stablecoins, declined by 2.44%.
This downturn in the crypto market was mirrored by outflows in several Bitcoin exchange-traded funds (ETFs), including GBTC, FBTC, ARKB, BITB, and HODL, despite a total daily net inflow of $50.6 million for U.S.-listed BTC ETFs. In contrast, Ether ETFs collectively posted a net inflow of $26.75 million, although many reported zero flow.
Traditional markets also faced significant losses. The technology-heavy Nasdaq 100 fell by 2.6%, while the S&P 500 Index dropped 1.4%, erasing nearly all of Wednesday’s gains. In Japan, the Topix index experienced its biggest fall since 2016, declining by 6%.
Despite the turmoil, some companies managed to perform well. MicroStrategy (MSTR) saw standout performance in the second quarter of 2024, driven by a 3.7% increase in BTC per share through “intelligent leverage,” a planned $2 billion equity offering for BTC purchases, and the anticipated adoption of fair-value accounting for BTC by the first quarter of 2025. Presto Research highlighted that these factors could benefit the broader Bitcoin market.
