Bitcoin Drops $2,000 After Weak U.S. Jobs Data

Bitcoin's recent surge was short-lived, as the cryptocurrency shed $2,000 after briefly surpassing $87,000 following weak U.S. jobs data. The employment numbers were lower than expected, with nonfarm payrolls forecast to increase by 90,000, down from 162,000 in August. This led to expectations of looser policy and renewed risk-on in crypto, but the market's reaction was mixed. Some traders saw the weak jobs data as a sign of a looser policy, while others believed it would lead to higher interest rates.

The Bitcoin futures ETFs in the U.S. had seen $3.1 billion in inflows over nine consecutive sessions, but later recorded about $148.7 million in net outflows on Wednesday. This ended the longest positive inflow streak of the year. Despite the outflows, Bitcoin continued to advance, reaching a high of $86,885 before reversing its gains. The U.S. 10-year Treasury yield reached multi-decade highs of 5.34%, which acted as a pressure point for risk assets.

Bitcoin dominance was closing in on 60%, while USDT's share slipped to around 6.3%. This shift in market dynamics was seen as traders moving out of cash and into tokens. Derivatives positioning showed $BTC open interest picked up to $22.4B from $20.9B, with funding rates starting to spike on some venues.