Bitcoin pared some of its earlier losses on Friday as US nonfarm payrolls and Treasury yields took center stage this week. After dropping below $92,000 amid a decline in equities, Bitcoin rebounded to more than $95,000 from its weekly low yesterday. The US economy added more jobs than expected in December and the unemployment rate unexpectedly fell. The recent broad-based decline in altcoins highlighted how renewed macroeconomic uncertainty and rising political risk surrounding Donald Trump’s inauguration have dampened crypto’s post-election euphoria. Meanwhile, interest rate market participants are increasingly betting on a pause in Fed rate hikes in January and beyond, while falling bitcoin futures funding rates signal a potential short-term decrease in bullish sentiment.
The market also digested the Federal Reserve’s December meeting minutes, released on Wednesday, which pointed to a slower pace of rate cuts in 2025. The minutes revealed that Fed officials anticipate reducing the pace of interest rate cuts this and next year, citing concerns about persistently high inflation and potential economic challenges, including tariffs and other policy changes under the new Trump administration. US employment data for December exceeded expectations. Nonfarm payrolls rose by 256,000, significantly higher than analysts’ forecast of 155,000 and November’s addition of 212,000 positions. The unemployment rate edged down slightly to 4.1%, compared to the expected 4.2%.
Earlier this week, US Treasury yields climbed once again, while US equities struggled. Taking a broader view, since the Federal Reserve began its rate-cutting cycle in September, yields on 10-year notes have risen from around 3.7% to over 4.75%. The US government’s monthly 10-year Treasury note auction on Tuesday recorded the highest yield since 2007 at 4.68%. Benchmark 10-year yields peaked at 4.73% on Wednesday morning, a level last seen in the spring of this year.
Market Overview
The global cryptoasset market capitalization currently amounts to roughly $3.45 trillion – up from the $3.6 trillion last week, with bitcoin accounting for 54%. Among the Top 30 cryptoassets by market cap, Bitget Token (BGB) outperformed, gaining 16% over the week. The price of bitcoin (BTC) fell by 4% to $94,201 while the price of ether (ETH) decreased by 9.8% to $3,277. The total value locked (TVL) in DeFi is sitting at $118 billion, with Ethereum (excluding Layer 2s) accounting for about 55% of TVL. Arbitrum One remains the largest Layer 2 by value locked, accounting for about 32% of the $53 billion in assets.
This Week’s Headlines
- Cynthia Lummis tapped to lead first-ever Senate crypto subcommittee
- FDIC Vice Chair urges more open approach to crypto, slams “Choke Point-like tactics”
- UK exempts crypto staking from collective investment scheme rules
- Financial advisors allocating crypto to clients doubles to 22% in 2024, according to Bitwise survey
- Kenya prepares to legalize cryptocurrencies in policy shift, according to report
- MicroStrategy buys another 1,070 bitcoin for $101 million, bringing holdings to 447,470 BTC
- MANTRA blockchain to tokenize $1 billion of real-world assets for UAE-based property firm DAMAC
Notable Deals and Fundraising
- Movement Labs close to finalizing $100 million Series B funding round, Fortune reports
- Sol Strategies raises $20 million via debt financing from ParaFi Capital to expand Solana staking operations
- Crypto market data provider SoSoValue hits $200 million valuation with $15 million Series A round
- JAN3 raises $5 million seed round to accelerate Bitcoin wallet AQUA’s development
- Verifiable AI firm Rena Labs raises $3.3 million in pre-seed funding
- Framework Ventures leads $2.5 million funding round for DePIN startup Starpower
- ZKsync-powered gaming L2 from iCandy raises $4 million in private funding
- Backpack Exchange acquires FTX EU
