Investing.com — Bitcoin prices fell further and lost further ground on Thursday as risk appetite remained subdued ahead of key US inflation data that is likely to be factored into the interest rate outlook.
The world's largest cryptocurrency was also weighed down by speculation about a sale of large amounts of tokens held by the U.S. government, but such a sale still seemed a long way off.
The broader crypto market also fell on Thursday, lagging far behind gains in other risk-driven markets, especially stocks.
By 12:50 a.m. ET (4:50 p.m. Japan time), shares were down 2.3% to $60,919.2.
CPI data awaits further interest rate indicators
Bitcoin was weighed down by the strength of , amid growing uncertainty over the US Federal Reserve's plans for further interest rate cuts.
Minutes from the Fed's September meeting show policymakers generally support the central bank's 50 basis point rate cut last month. However, they did not commit to the pace of future rate cuts.
This comes after last week's strong jobs data showed traders were now betting on a 25bps rate cut, wiping out bets on a 50bps rate cut in November. .
Statistics to be released later on Thursday are now squarely in focus for further clues on the direction of interest rates. The headline CPI is expected to decline slightly in September, but remain flat.
The prospect of US interest rates remaining high for an extended period bodes poorly for cryptocurrencies, given that it indicates less liquidity available for investing in speculative assets.
Bitcoin weighs on speculation over $4 billion government sale
Some speculation surrounding a mass sale of tokens seized from the Silk Road market by the US government also weighed on Bitcoin.
Earlier this week, the Supreme Court upheld a court order directing the government to liquidate 69,370 bitcoins seized from the market.
Although such a liquidation does not appear to be imminent, the sale could result in around $4 billion worth of Bitcoin being spilled onto the public market and hurting its price.
Token distribution by defunct cryptocurrency exchange Mt.Gox caused Bitcoin prices to plummet earlier this year.
Today's virtual currency prices: Altcoins also fall following Bitcoin
Among broader crypto prices, the world's second-largest cryptocurrency fell 2.1% to $2,395.41.
which fell between 1% and 3%, down 0.3%.
Meme tokens decreased by 0.3%.
