(Bloomberg) — Bitcoin slipped below $40,000 once more, reversing nearly all of the gains sparked by optimism over U.S. President Joe Biden’s cryptocurrency executive order. Digital currencies fell along with stocks on Thursday amid high inflation data and continued geopolitical uncertainty.
The largest cryptocurrency was down as much as 7.9% at $38,582 on Thursday, its first drop in three days. Ether fell as much as 5.7% to $2,553. Most major cryptocurrencies were down at least slightly in the previous 24 hours as of 9:30 a.m. New York time, according to CoinGecko prices.
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Bitcoin erases much of what it gained yesterday
US stocks and some risk assets are under pressure following the nation’s consumer price index rose to a maximum of 40 years and while the war in Ukraine continues to weigh on basic products. In recent years, bitcoin has shown a tendency to follow the movements of the stock market. A 50-day correlation coefficient between the token and the S&P 500, one of the most closely watched US market indicators, is 0.5; A score of 1 equates to similar variations.
Bitcoin rose as much as 11% on Wednesday amid optimism regarding the trajectory of US regulation of digital assets as the framework of Biden’s executive order on cryptocurrencies became clear. However, those gains proved fleeting as traders digested the news, with the token once once more trading near the middle of the range where it has been for most of the past two months.
original note:
Bitcoin Dips Below $40,000 as Inflation Data Boost Risk-Off Mood
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