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Bitcoin prices dipped slightly on Friday, erasing some of the gains seen in the past two days as caution prevailed following warnings from Federal Reserve officials about the possibility of interest rate cuts this year.
The world’s largest cryptocurrency remained firmly within a tight trading range of $60,000 to $70,000 established over the past two months, lacking significant catalysts to break out amidst subdued capital flows and tepid risk appetite.
Bitcoin Price Movement
Bitcoin edged down by 0.5% to $65,473.3 by 01:30 ET (05:30 GMT).
Despite its range-bound trading, Bitcoin marked strong gains over the past seven days, rebounding from last week’s low of $60,000. The cryptocurrency was up approximately 8% from its recent lows, buoyed by weakness in the dollar amid signs of easing U.S. inflation.
Impact of Fed Comments
The enthusiasm surrounding Bitcoin somewhat diminished on Friday, restraining its gains after several Fed officials cautioned against premature assumptions of interest rate cuts.
Members of the Fed’s rate-setting committee emphasized the need for more substantial evidence beyond a single month of soft inflation readings before considering any adjustments to interest rates. Their remarks triggered a dollar rebound and halted the rally in most risk-driven assets.
Moreover, concerns about potential regulatory actions against the cryptocurrency industry continued to weigh on sentiment towards digital assets.
Altcoins and Meme Tokens
In the broader cryptocurrency market, major altcoins retreated on Friday, mostly trailing behind Bitcoin’s performance over the past week due to muted sentiment towards cryptocurrencies.
- Ethereum, the second-largest cryptocurrency, declined by 2.1%.
- Solana and XRP experienced marginal fluctuations.
Meme tokens mirrored a downturn in their stock counterparts, as the recent rally in meme stocks like GameStop Corp and AMC Entertainment Holdings Inc reversed course in recent sessions. Dogecoin fell by 3.6%, while Shiba Inu lost 2.8% on Friday.
Amidst the cautious market sentiment and ongoing regulatory uncertainties, the outlook for cryptocurrencies remains uncertain, with investors closely monitoring developments in the broader financial landscape and regulatory environment.
