The price of Bitcoin wavered Friday as a stock market selloff intensified on Wall Street, and the tech-heavy Nasdaq slid into a market correction after a weaker-than-expected U.S. jobs report.
As of this writing, the Nasdaq was set to close 10% below its record peak last month, falling 2.9% on the day. Meanwhile, the S&P 500 and Dow Jones Industrial Average had dropped more than 2% each, setting stocks up for one of their worst trading days since 2022.
Meanwhile, the Nikkei 225 had fallen 5.8%, as the stock market index for the Tokyo Stock Exchange posted its worst day since March 2020, according to CNBC. The punishing route Friday represented a continuation of selling spurred by manufacturing data Thursday.
The price of Bitcoin fell sharply over the course of a couple hours Friday, diving 4.4% to around $62,500 from $65,400. While Bitcoin’s price was still slightly up on the day at a current price of around $63,170, Ethereum and Solana, meanwhile, had fallen nearly 3% to $3,025 and over 4% to $155, respectively.
The Labor Department reported Friday that the unemployment rate had ticked up to 4.3% in July, representing its highest level since October 2021. While the U.S. economy added 179,000 jobs in June, the report indicated that nonfarm payrolls grew by 114,000 last month.
Job growth in July was “below the average monthly gain of 215,000 over the prior 12 months,” the Labor Department said. Economists expected that the U.S. economy would add 175,000 jobs last month, according to data from Trading Economics.
Friday’s report sparked fears that the U.S. economy could be sliding into a recession, as the highest interest rates in 22 years present higher borrowing costs for businesses and consumers. As the Federal Reserve is widely expected to cut interest rates next month, some analysts wondered whether expectations of a so-called soft landing could be premature.
“Did we have a soft landing or was [a] recession just delayed?” Grayscale’s Head of Research Zach Pandl wrote in a post on (Twitter aka X), citing July’s slower payroll growth, a decline in workweek hours, smaller wage gains, and rising unemployment rate.
Meanwhile, the price of publicly-traded crypto companies faced headwinds too. The Bitcoin-driven software firm MicroStrategy—the largest corporate holder of BTC—saw its stock price decline 3% intraday to $1,460, while the crypto exchange Coinbase saw shares slide 2.8% to $208.
At the conclusion of this week’s Federal Open Market Committee (FOMC), Fed Chair Jerome Powell suggested that the U.S. central bank is focused on the U.S. labor market. As the pace of inflation slows toward the Fed’s 2% goal, Powell said that jobs have come more in focus.
"We are watching labor market conditions quite closely," Powell said. "I would not like to see a material further cooling in the labor market."
Edited by Andrew Hayward
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