Bitcoin Dominance Nears 60% as Traders Bet on Risk-On Market

Crypto traders are in risk-on mode as Bitcoin dominance nears a return to 60%, with the leading cryptocurrency rising 3.4% to over $86,000 ahead of the U.S. jobs report. This surge in Bitcoin's price is accompanied by gains across the broader crypto market, indicating a growing appetite for risk among traders. Economists expect the United States to have added 90,000 jobs in September, and a stronger-than-forecast report could lift Treasury yields, revive interest-rate increase bets, and potentially pressure Bitcoin.

Rising open interest and funding rates in derivatives markets suggest traders are adding leveraged bullish positions, although $344 million in liquidations underscores the risk of heightened volatility. The share of Bitcoin in the total crypto market, known as its dominance, is closing in on 60%, while the share held by USDT, the largest dollar-pegged stablecoin, slipped to around 6.3%. This shift in market dynamics points to a growing comfort with risk among traders.

Analysts are watching the jobs data and the October 14 consumer price index report for their effect on Treasury yields, particularly inflation-adjusted or real yields. Oliver Carding, head of marketing at Tesseract Group, noted that a sustained move above a 10-year real yield of about 3% would make a retest of $80,000 to $82,000 more likely than a run at $90,000. Markets currently see a 30% chance of a rate hike in October, down from 70%, which tends to support risk assets like Bitcoin.