First Mover Americas: Bitcoin slips as report shows faster-than-expected US jobs growth

As Bitcoin’s price has steadily declined – the largest cryptocurrency has just come off a nine-week record losing streak – analysts in Digital asset markets have wondered if a “crypto winter” has arrived.

The term dates back to the cold spell of 2018, when the price of Bitcoin fell 73% that year alone, accompanied by a price drop for tokens that recently at the forefront of the market were “Initial Coin Offerings” or ICOs. Cryptocurrency companies cut jobs, bitcoin miners shelved new projects, and the breathless headlines faded from the mainstream press.

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Exchanges Coinbase and Gemini’s recent cost-cutting measures show how seriously the industry heavyweights are taking the pullback.

Riot Blockchain, one of the largest publicly traded bitcoin miners, has dumped more than half of the bitcoin mined in May, CoinDesk’s Aoyon Ashraf reported on Thursday. When Bitcoin price falls, more miners shut down or sell their holdings to fund the operating budget; High energy prices depress profits on the cost side.

“The effects were felt everywhere. Nothing was spared from this drop,” wrote QCP Capital, a trading firm, in a note to Telegram subscribers on Friday.

QCP has calculated some of the key comparisons between the current market and 2018. Below are some of the key highlights. Get ready.

• “When we reach the 85% and 95% drawdowns of 2017 for BTC and ETH, respectively, we will look at the levels of $10,000 for BTC and 250 for ETH.”
• “While we think this is unlikely, the strong negative skewness in the vol markets reflects some fear that this might happen .”
• “In 2017, it took about 1 year to find the bottom for BTC and ETH. We may still be some time away from absolute bottom.”

According to QCP, a major driver of the pullback was the withdrawal of stimulus liquidity by the Federal Reserve and other central banks. Some of the riskiest tokens may have been the biggest beneficiaries of money printing-driven central bank balance sheet expansion Coins have had the largest drawdowns,” QCP wrote. “When easy money dries up, coins with the lowest utility and highest multipliers suffer the most.” In the inverted logic of financial markets, where the Federal Reserve serves as both an economic counterforce and an £800 gorilla, that could happen when the data starts to look really ugly.

“We are therefore now entering a ‘bad news is good news’ phase in terms of growth and employment data,” wrote QCP. “Market would trade positively on negative news as it would reduce Fed hawkishness.” Latest Headlines Crypto Firms, Especially Exchanges, Cut Jobs as Market Crisis Continues Many crypto companies are announcing significant job cuts and hiring freezes amid challenging times for cryptocurrency and stock markets.