The recent stronger-than-expected U.S. private payrolls report has stirred concerns about the Federal Reserve's interest rate policy, impacting Bitcoin's price movement. The ADP report indicated an addition of 183,000 jobs in January, surpassing expectations and suggesting that the Fed might maintain higher interest rates for a longer period. This has put pressure on Bitcoin and other cryptocurrencies, as a robust labor market could delay anticipated rate cuts, affecting investor sentiment. Additionally, the ongoing U.S.-China trade negotiations and recent retaliatory actions from China have added to market uncertainty, further influencing Bitcoin's price dynamics. A decline in Bitcoin's network activity, reaching its lowest level in a year, has also contributed to the downward pressure on its price. Analysts note a 15% decrease in network activity since November 2024, with a significant drop in daily transaction counts, suggesting potential overvaluation concerns.
The 2x Bitcoin Strategy ETF (BITX) experienced a decline, dropping 1.94% to $54.49 at 12:40 PM on Wednesday, February 5.