In brief
- Bitcoin hovered near $108,000 and Ethereum traded around $3,750, extending cautious positioning ahead of Friday’s U.S. employment report.
- Bessent said high rates “may have driven” parts of the economy into recession, fuelling debate over whether future cuts would signal strength or stress.
- On-chain data shows Bitcoin stuck below a key $113,000 cost-basis level.
Crypto edged lower on Sunday as traders positioned ahead of U.S. jobs data due later this week and digested comments from Treasury Secretary Scott Bessent suggesting that high interest rates are beginning to strain parts of the economy.
Bitcoin traded around $108,000, down roughly 1.7% over the past 24 hours, while Ethereum slipped about 3.5% to near $3,750, CoinGecko data shows.
Major tokens softened across the board, with alt-coins underperforming as investors maintain a defensive stance.
In an interview aired over the weekend, Bessent told CNN that the Federal Reserve’s restrictive policy “may have driven parts of the economy, particularly housing, into recession,” and argued the central bank now has room to cut rates.
He warned that keeping borrowing costs elevated risked deeper economic pressure, especially for leveraged households.
Crypto initially strengthened on the prospect that Bessent’s remarks could reinforce the case for easing, but gains faded as traders weighed whether cuts driven by slowing activity might spur near-term volatility rather than a clean liquidity impulse.
Bitcoin dominance remained firm, signaling limited risk appetite in smaller tokens.
With U.S. markets set to reopen Monday, investors are focused on Friday’s employment report, due at 8:30 a.m. ET, with economists expecting a moderation in hiring while unemployment holds near recent levels.
The data will help clarify whether rate cuts reflect confidence in a soft landing or growing concern that pockets of the economy are weakening.
On-chain metrics also point to softening momentum.
Bitcoin has failed to climb back above the short-term holders’ cost basis near $113,000, a level some analysts view as the dividing line between bullish and corrective phases.
The threshold has capped prices for three weeks, following six months of trading above it, signaling fading demand at current levels, Glassnode wrote in a report last week.
A sustained break lower raises the risk of a deeper pullback, with the next significant support near $88,000, Glassnode analysts wrote.
That’s based on the realized cost basis of actively circulating supply, a level that has marked corrective phases in prior cycles.
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