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▲ Upbit market held its breath. Bitcoin, XRP, and other major altcoins plummeted simultaneously/AI generated image ©
Strong US employment figures revived concerns about interest rate hikes, leading to another sharp downturn in the domestic cryptocurrency market. On Upbit, Bitcoin (BTC) fell below 110 million won, and major indices and top market capitalization cryptocurrencies all showed weakness.
As of 8:18 AM on September 5, Bitcoin was trading at 109,127,000 won on Upbit, the largest domestic cryptocurrency exchange, down 1.62% from the previous day. The intraday high was 111,392,000 won, and the low was 107,713,000 won, with a price fluctuation range exceeding 3.6 million won. At the same time, XRP (Ripple) fell by 3.23% to 1,915 won, Ethereum (ETH) dropped by 1.81% to 3,361,000 won, and Solana (SOL) declined by 1.62% to 139,600 won.
The general weakness in the Upbit market was also evident. The Upbit Composite Index fell by 1.43% to 11,020.78, while the Upbit Altcoin Index dropped by 1.90%, and the Upbit10 Index by 1.82%. The Bitcoin Group and Ethereum Group also decreased by 1.60% and 1.78% respectively, and the Upbit30 Index also fell by 1.76%. As altcoins showed a larger decline than top market capitalization assets, risk aversion sentiment appears to be spreading across the market.
This decline is attributed to strong US employment figures raising the possibility of an interest rate hike by the Federal Reserve (Fed). US non-farm payrolls in August increased by 162,000 from the previous month, approximately three times higher than market expectations. The probability of a September interest rate hike, as reflected by the Chicago Mercantile Exchange (CME) FedWatch, rose by 9 percentage points from the previous day to 58.4%. US 2-year and 10-year Treasury yields rose to 4.379% and 4.783% respectively, and the dollar index also increased by 0.21% to 99.17, putting pressure on risk assets such as cryptocurrencies. In the New York stock market, the Dow Jones Industrial Average fell by 0.51%, the Standard & Poor's (S&P) 500 Index by 0.38%, and the Nasdaq Composite Index by 0.29%.
Although prices fell, Upbit's trading volume slightly increased. According to Upbit Datalab, as of 8:19 AM, the daily trading volume was 1.6 trillion won, and the recent 24-hour trading volume was 1.64 trillion won. The 24-hour trading volume increased by 2.45% compared to the previous period. XRP maintained its top position, accounting for 14.14% of the total trading volume, followed by Bitcoin at 9.68%, Tether (USDT) at 6.76%, Ethereum at 6.71%, and FLOCK at 4.68%. Despite the increase in trading volume, major assets collectively declined, suggesting that rather than new purchases, there was an increase in selling and short-term speculative trading during a period of increased volatility.
The market's focus is expected to shift to the US August Consumer Price Index (CPI). If inflation, following employment, turns out stronger than expected, concerns about the Fed's interest rate hike could intensify further, potentially putting additional downward pressure on Bitcoin and altcoins. The conflict in the Bab-el-Mandeb Strait, connecting the Red Sea and the Gulf of Aden, has also contributed to rising inflation concerns, with Brent crude and West Texas Intermediate (WTI) crude rising to $96.28 and $91.48 respectively. Conversely, if the CPI eases market concerns and Bitcoin quickly recovers the 110 million won level, some of the losses might be recouped. However, high volatility is expected to continue for some time, influenced by US Treasury yields and dollar movements.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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