- Bitcoin dropped 5%, trading near $96,259, while the global crypto market fell 16% to $3.38 trillion.
- BlackRock’s iShares Bitcoin ETF saw $597M inflows, surpassing 6,078 BTC mined on January 7.
- Rising U.S. Treasury yields and a strong dollar index impacted Bitcoin, with altcoins and meme tokens dropping 5-10%.
Bitcoin experienced a sharp decline, dropping 5% to trade near $96,259 as macroeconomic factors weighed heavily on the cryptocurrency market. This downturn reflects cautious investor sentiment fueled by strong U.S. economic data, including higher Treasury yields and robust job market performance. The global crypto market followed suit, falling 16% to $3.38 trillion, with major altcoins seeing declines of 5% to 10%.
BlackRock’s Steady Inflows Contrast Market Volatility
However, despite the bearish trend, BlackRock’s iShares Bitcoin ETF (IBIT) recorded a significant $597 million inflow, underscoring strong institutional interest. On January 7, the ETF added 6,078 BTC worth $208.7 million, exceeding the total Bitcoin mined that day.
Overall, spot Bitcoin ETFs witnessed inflows nearing $978 million, with BlackRock leading the charge. This development occurred as other Bitcoin ETFs, including Fidelity’s FBTC and Bitwise’s BITB, reported combined outflows exceeding $400 million.
Macroeconomic Data Intensifies Downward Pressure
Moreover, the strengthening U.S. dollar and rising Treasury yields have significantly impacted Bitcoin’s performance. The dollar index remains above 108.50, while the 10-year Treasury yield climbed to 4.68%, the highest in 35 weeks.
Consequently, these factors have made traditional investments more appealing, pulling focus away from digital assets. Additionally, improved service sector data and job openings contributed to market volatility, further challenging Bitcoin’s recovery prospects.
Altcoins and Meme Tokens Follow Bitcoin’s Lead
Notably, the broader crypto market mirrored Bitcoin’s struggles, with notable altcoins and meme tokens facing steep declines. Dogecoin (DOGE) dropped by 8%, while Shiba Inu (SHIB) experienced a 10% dip.
Therefore, this widespread decline highlights the fragility of investor sentiment amidst macroeconomic headwinds. Trading volumes also fell by 23%, indicating reduced activity and heightened caution among traders.
