The cryptocurrency market faced fresh challenges on Thursday, with an unexpected rise in inflation and another regulatory move by U.S. authorities targeting a major crypto firm.
Bitcoin (BTC) dropped $59,000, a price not seen since the Federal Reserve’s recent surprise interest rate cut. Despite this drop, BTC managed to regain some of the losses and is currently priced at $59,800.
The inflation report, showing higher-than-expected price increases in September, shook hopes that the Federal Reserve might continue cutting rates. Some investors now speculate that the Fed may pause its rate reductions in November.
The crypto market saw significant sell-offs, wiping out around $147 million in long positions as rising oil prices and inflation worries dominated sentiment.
Later in the day, the SEC filed a lawsuit against Cumberland DRW, accusing it of trading crypto assets deemed to be securities without proper registration. Cumberland dismissed the allegations, saying it would maintain its current business operations.
This action came just a day after U.S. authorities charged multiple market makers and individuals with manipulation, and SEC Chair Gary Gensler reiterated his harsh stance against the crypto industry, describing it as fraught with misconduct.
With ongoing regulatory scrutiny and uncertainty around U.S. monetary policy, some analysts believe Bitcoin’s price may remain stagnant until the upcoming U.S. elections in November.