03/04 Market Recap: Bitcoin Recovers After Dip to $64,500, ICP Surges 10%


Bitcoin’s price took a tumble earlier today, briefly dropping to $64,500 – its lowest level in 10 days. However, the cryptocurrency staged a recovery, climbing back above $66,000 by midday. Bitcoin had flirted with the $72,000 level last week but faced resistance in breaking its all-time high near $74,000.

While Bitcoin lost around 2% over the past 24 hours, some altcoins fared worse with Ethereum dipping to $3,300 and XRP falling below $0.60. However, a few altcoins bucked the trend – ICP surged nearly 10% to trade above $18, while NEAR and WIF each gained around 6%.

The crypto market downturn coincided with rising U.S. Treasury yields, which reached a two-week high of 4.4% on the 10-year note. Higher risk-free rates tend to draw investors away from risk assets like cryptocurrencies. Prediction markets now see virtually no chance of a Fed rate cut until later this year, weighing on crypto sentiment.

“Bitcoin retraced down to $65,000, mostly attributed to the recent macro outlook on interest rates and rising Treasury yields,” said Semir Gabeljic of Pythagoras Investments. “Higher interest rate environments typically tend to reduce investor appetite for risk.”

Data shows over $245 million in long crypto positions were liquidated in the past day, including $60 million in Bitcoin longs, as leveraged traders were flushed out. Perpetual futures funding rates dropped back to 1bp, and global futures open interest fell 10%, signaling an unwinding of the recent bullish frenzy.

Amidst the market volatility, the U.S. Department of Justice transferred around $2 billion worth of Bitcoin seized from the Silk Road darknet marketplace case to new wallets. The funds had been confiscated from James Zhong after his 2021 conviction.

In other news, blockchain security firm CertiK warned that while hacking incidents were typical this quarter, sophisticated phishing attacks and private key compromises reached “alarming levels.” $239 million was lost to private key hacks, up 1,171% from Q1 2023.

Additionally, a broken smart contract has locked up $24 million worth of Lido staked SOL tokens, with holders unable to withdraw due to the complex unstaking process.

Overall, while Bitcoin staged a recovery from its overnight dip, the crypto markets were weighed down by macro forces and rising interest rates that have cooled the recent bullish momentum.