Cryptocurrencies rebound with risk assets, but ether still lower for the week

Crypto prices rose on Friday following two down days in which investors rotated out of risk assets.

Bitcoin was last higher by 4.5% at $67,720.83, according to Coin Metrics, and ether advanced 4% to $3,248.25.

In equities, the tech-heavy Nasdaq Composite and the broad-market S&P 500 — which suffered their worst single trading day since 2022 this week — rallied. Coinbase and MicroStrategy jumped 7% and 10%, respectively, on Friday.

Bitcoin spiked after the Federal Reserve’s preferred inflation gauge, the personal consumption expenditures price index, showed price increases eased slightly in June from a year ago, paving the way for a widely anticipated September interest rate cut.

Investors are also looking ahead to the second day of the Bitcoin Conference in Nashville, where former President Donald Trump is expected to give a speech on Saturday. Many expect favorable crypto comments from Trump — who in recent weeks has painted himself as the pro-crypto candidate in this year’s election — could boost prices in coming days.

Still, bitcoin is little changed for the week, while ether is on pace to end the week with an 8% loss.

This week’s rout in tech stocks, spurred by disappointing quarterly earnings from Alphabet and Tesla, had investors rotating out of risk assets, including bitcoin and ether.

The market is also in the middle of an ongoing Mt. Gox repayment schedule that has resulted in bitcoin selling pressure this month at the same time as the newly launched Grayscale Ethereum Trust (ETHE) has seen significant outflows — compared to the other funds’ inflows — that have put downward pressure on the price of ether.