Key facts
- Coinbase (COIN) stock was down around 4% to $180.75.
- Bitmine (BMNR) stock fell approximately 5%.
- Circle (CRCL) stock declined more than 5% to $90.65.
- Bitcoin prices remained near flatline.
- Remarks from Fed officials Kevin Warsh and Michael Barr suggested a potential for further interest rate hikes.
- The probability of a September Fed rate hike rose to about 67%.
Leading cryptocurrency-related stocks, including Coinbase (COIN), Bitmine (BMNR), and Circle (CRCL), experienced declines as Bitcoin prices remained largely stagnant. This downturn is attributed to concerns over potential Federal Reserve interest rate hikes, influenced by recent remarks from Fed officials.
Coinbase stock fell approximately 4% to $180.75, though it has gained over 23% in the past 30 days. Bitmine saw a dip of around 5%, while Circle, the issuer of USDC, dropped more than 5% to trade at $90.65. Despite these short-term declines, some market experts, like Cathie Wood, reportedly maintain a bullish outlook on Circle.
The broader market sentiment appears cautious, with investors anticipating a potential Fed rate hike in September. Federal Reserve Chair Kevin Warsh's comments at Jackson Hole last week suggested a hawkish stance if inflationary pressures persist. Echoing this, Fed Governor Michael Barr noted that current inflation remains higher than anticipated, indicating that the central bank might consider further rate increases if inflation does not cool down.
According to the CME FedWatch Tool, the probability of a Fed rate hike in September has risen to approximately 67%, up from around 40% the previous week. This increased likelihood of tighter monetary policy has contributed to the cautious trading observed in crypto stocks.