"Bitcoin's Rebound Slows Amid Broader Crypto Market Volatility"
Bitcoin price rose on Wednesday, extending a rebound from over five-month lows as bargain buyers stepped in and sentiment improved slightly, although the tokenâs recovery appeared to be running out of steam. This trend was also reflected in broader crypto prices, where gains slowed from the prior session as concerns over a U.S. recession, Japanese interest rate hikes, and tensions in the Middle East continued to weigh on sentiment.
#Bitcoinâ rose 1.9% to $56,952.4 by 01:26 ET (05:26 GMT) after slumping as low as $49,000 on Monday. However, gains slowed after a nearly 4% rebound on Tuesday, with the token still trading below levels seen before Mondayâs rout. The crypto market struggled with the prospect of a mass sale by the U.S. government and waning interest in crypto derivatives.
Risk-off sentiment led to steep outflows from crypto derivatives, mainly exchange-traded funds. Optimism over an improved regulatory environment in the U.S. waned as the 2024 presidential race heated up. Democratic nominee Kamala Harris was seen catching up with Republican nominee and pro-crypto candidate Donald Trump, according to a Bloomberg poll.
The International Monetary Fund (IMF) reported progress in talks with El Salvador over a funding program, but noted Bitcoin adoption remained a point of contention. El Salvador adopted Bitcoin as legal tender in 2021, planning infrastructure around the cryptocurrency, but saw little improvement in its fiscal situation and few takers for its "Bitcoin bonds."
On Wednesday, broader crypto prices were mixed.
Ether fell 0.7% to $2,504.90, while XRP lost 0.4%. ADA and SOL rose 1.3% and 7.2%, respectively. Among meme tokens, $DOGE fell 0.9%, and $SHIB lost 1.4%.