Bitcoin Plummets 3.5% on Strong US Jobs Data

Bitcoin (BTC) plummeted as much as 3.5% on September 4 after stronger-than-expected US jobs data fueled bets on a Federal Reserve rate hike in September.

The token dipped to $78,649 alongside stocks and bonds following the release of August nonfarm payrolls, which rose 162,000, surpassing every estimate in a Bloomberg survey. The unemployment rate remained steady at 4.1%.

Two-year Treasury yields surged as the dollar strengthened, reversing Bitcoin's recent push above $80,000. This reversal tests the cryptocurrency's repeated struggle around this level.

Fabian Dori, chief investment officer at Sygnum Bank, noted that a strong jobs report 'arms the hawks' and validates current September hike probabilities. However, he emphasized that other factors, such as Treasury cash balances, bank balance-sheet capacity, private credit creation, and stablecoin supply, remain independent of short-term Fed decisions.

Crypto-related companies also declined in response to the news: Coinbase Global Inc. dropped around 4%, while Bitcoin accumulator Strategy Inc. and stablecoin issuer Circle Internet Group Inc. each slipped around 2%.