Cryptocurrency Market Update

A rally in cryptocurrency prices faded as Wall Street’s risk-off mode impacted the broader market, alongside significant losses in tech shares.

Bitcoin (BitfinexUSD) appears to be pausing as October wraps up, trading around $70,600 in early US trading, down about 2.35% over the past 24 hours. ETH/USD fell 4.7% while Polkadot declined about 5%.

Despite today’s slump, Bitcoin has climbed over 8% this week. Additionally, spot Bitcoin ETFs experienced substantial inflows, pulling in $893 million on Wednesday, marking its second consecutive day above the $850 million threshold. Much of this demand was driven by BlackRock (NYSE:BLK)'s IBIT, which alone accounted for $872 million.

As earnings season is underway, traders are preparing for the U.S. presidential election and significant economic reports, such as the upcoming nonfarm payrolls numbers, as they look for signs of possible rate cuts from the Federal Reserve.

"Stocks are sliding in the US this morning for various reasons, including disappointing mega-cap tech earnings on Wednesday night (META issued warnings about high costs while MSFT provided Dec Q revenue guidance that fell short of expectations)," noted Vital Knowledge analysts.

Wall Street saw a decline on Thursday as Microsoft and Meta’s warnings regarding rising AI expenses dampened enthusiasm around mega-cap stocks.

Meta Platforms Inc (NASDAQ:META) shares fell 2.8%, and Microsoft Corporation (NASDAQ:MSFT) dropped 5.1%, despite both exceeding earnings expectations in their Wednesday reports. Adding to the pressure, the United States 10-Year yield edged up past 4.3%, further weighing on stocks.

Bitcoin has been nearing its all-time high this week, increasing from around $71,000 to over $73,500 by Tuesday. This upward momentum occurs just days before the U.S. elections, a period many traders anticipate as bullish for markets, irrespective of the election's outcome.

Polls indicate a tight race between Donald Trump and Kamala Harris, fueling market speculation as Bitcoin approaches its all-time high of $73,798, previously recorded in March. This recent surge has the most-traded cryptocurrency within striking distance of this peak, adding to the pre-election market excitement.