Investing.com-- Bitcoin saw slight gains on Friday after the December jobs report but was set for steep losses this week as heightened concerns over slower U.S. interest rate cuts and potential coin sales by the government eroded sentiment towards crypto.
Crypto markets also largely tracked a downturn in broader risk-driven markets, as traders pivoted into safe havens such as gold and the dollar amid heightened economic uncertainty.
Bitcoin climbed 1.9% to $93,876.0 by 09:09 ET (14:09 GMT), after dropping as low as $92,474.1 earlier in the day.
Broader crypto prices also saw muted performance in tandem with Bitcoin.
Bitcoin heads for weekly losses
Bitcoin was trading down about 4.4% this week, its worst performance since late-September.
In addition to a broader risk-off sentiment, Bitcoin was also pressured by reports that the Department of Justice had received court approval to sell about $6.5 billion worth of Bitcoin confiscated from the Silk Road black market.
While the DOJ sale represents increased selling pressure on Bitcoin, it also quashed hopes that incoming President Donald Trump would convert the government’s confiscated token holdings into a strategic reserve.
Trump has vowed to enact crypto-friendly regulations and has also floated the possibility of a Bitcoin strategic reserve.
But analysts expressed some doubts over just how he will create the reserve, given that Congress is unlikely to ok any additional fiscal spending on government Bitcoin purchases.
Still, optimism over Trump spurred sharp gains in Bitcoin through late 2024, driving the coin to record highs of over $108,000. Trump was also seen nominating a slew of crypto-friendly candidates to key regulatory roles.
December jobs blast past expectations, unemployment rate drops
The U.S. labor market showed strong momentum in December, with job growth far exceeding economists' expectations and the unemployment rate posting an unexpected decline.
The Bureau of Labor Statistics reported on Friday that the economy added 256,000 jobs last month, well above the forecast of 160,000 and higher than November’s revised figure of 212,000, previously reported as 227,000.
The unemployment rate dropped to 4.1% in December, slightly better than the anticipated 4.2% and November's 4.2%.
These robust employment figures come after a series of recent economic reports prompted a sell-off across markets, as investors adjusted their outlook on the Federal Reserve’s potential rate cuts in 2025.
Crypto price today: altcoins slightly up
Broader crypto prices tracked Bitcoin's slight gain, as risk appetite remained constrained in anticipation of the nonfarm payrolls report.
The report comes just days after the minutes of the Federal Reserve’s December meeting reiterated the bank’s outlook for fewer interest rate cuts in 2025, which bodes poorly for risk-driven assets.
World no.2 crypto Ether added 0.6% to $3,259.77, while XRP rose 1.8% to $2.284.
Solana, Cardano, and Polygon jumped between 1% and 5%, while among meme tokens, DOGE/USD rose 2.8%.
Ambar Warrick contributed to this report.