Cryptocurrencies took a breather today as the price of Bitcoin retreated from $100,000 and traded around $97,500 as of 1 p.m. ET. Treasury yields rose in anticipation of new inflation data later this week, but otherwise, it was not immediately clear what drove the sell-off.
Other cryptocurrencies followed Bitcoin’s lead and struggled today as well. The price of XRP (CRYPTO: XRP) had fallen 6.6%. Meanwhile, meme tokens Dogecoin (CRYPTO: DOGE) and Shiba Inu (CRYPTO: SHIB) were down 5.4% and 5.2%, respectively.
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Despite a rise in the 10-year U.S. Treasury yield, which has previously pressured Bitcoin’s price, most crypto news this morning seemed positive. The heavy Bitcoin buyer MicroStrategy just announced another $2.1 billion of Bitcoin purchases at an average price of $98,783 and the company now holds $25.6 billion of Bitcoin.
Meanwhile, some Amazon shareholders are proposing the company follow in MicroStrategy’s footsteps and hold 5% of its assets in Bitcoin. The more ingrained Bitcoin becomes in the mainstream financial system, the better it will likely perform so it’s an interesting development.
In more negative headlines, media outlets reported that El Salvador will scale back some of its Bitcoin laws to secure loan agreements from the International Monetary Fund (IMF), the World Bank, and the Inter-American Development Bank. El Salvador bet big on Bitcoin several years ago, making it legal tender in the country in 2021, and accumulating a significant amount of Bitcoin. The country has made hundreds of millions of gains.
Ultimately, I think the most likely reason for the pullback is investors taking a breather, which is healthy during bull markets. In more token-specific news, Ripple CEO Brad Garlinghouse appeared on CBS’ 60 Minutes last night to discuss President-elect Donald Trump’s victory, what it means for the sector, and other crypto regulations. Ripple is the company behind XRP. Investors have been excited about the appearance and it could have contributed to XRP’s tremendous run recently.
However, Garlinghouse seemed disappointed with the interview. On X, Garlinghouse said the interview left out critical details about the Securities and Exchange Commission’s (SEC’s) lawsuit against Ripple such as how a federal judge ruled in Ripple’s favor that XRP is not a security. This could be contributing to XRP’s struggles today. There’s no way to know but generally, I would expect meme tokens like Dogecoin and Shiba Inu to underperform or outperform most of the sector, so XRP’s underperformance today could point to more token-specific news.
