Bitcoin moved higher on Thursday, extending its recent gains after a strong third quarter. Improving sentiment around U.S. crypto regulation helped support renewed buying interest.
However, the broader cryptocurrency rally lost some momentum heading into the fourth quarter. Rising U.S. Treasury yields and expectations for further Federal Reserve interest rate increases continued to pressure risk assets.
Bitcoin climbed about 1.5% to $84,307, after briefly trading at even higher levels earlier in the week.
Bitcoin Gains After Softer U.S. Inflation Data
Bitcoin rose as high as $85,600 on Wednesday following the release of U.S. PCE inflation data.
The figures came in slightly below expectations, encouraging hopes that easing inflation could reduce the need for aggressive Federal Reserve rate increases.
That initially boosted demand for Bitcoin and other risk-sensitive assets.
However, the positive reaction was limited by another sharp rise in U.S. Treasury yields, which reached fresh multi-year highs despite the softer inflation data.
High Treasury Yields Limit Bitcoin Upside
Higher bond yields remain an important headwind for Bitcoin.
When yields rise, traditional fixed-income assets can become more attractive to investors. This can reduce demand for higher-risk assets such as cryptocurrencies.
At the same time, strong enthusiasm surrounding artificial intelligence also directed capital toward technology and semiconductor stocks.
Blowout earnings from Micron helped strengthen interest in AI-related equities, potentially limiting some of the flows into crypto markets.
Markets Await U.S. Jobs Data
Investor attention is now turning to upcoming U.S. nonfarm payrolls data for August.
The report is expected to provide further clues about the health of the U.S. economy and the Federal Reserve’s next steps on interest rates.
Expectations for an October rate increase have eased somewhat following more dovish comments from a Federal Reserve official earlier this week.
Any significant shift in rate expectations could have a major impact on Bitcoin, the U.S. dollar and broader financial markets.
OpenUSD Stablecoin Goes Live
The cryptocurrency sector also received fresh institutional news this week after the OpenUSD stablecoin officially launched.
The project is backed by major companies across payments and crypto, including Visa, Mastercard, Stripe and Coinbase.
OpenUSD was first announced in June and has now launched across several blockchain networks, including Ethereum, Solana, Coinbase’s Base and Stripe-backed Tempo.
The company behind the stablecoin is targeting several areas, including banking, cross-border payments, card settlements, institutional trading and lending.
Open Standard reportedly has more than 140 partners across finance, payments, technology and crypto, including BlackRock, BNY and Standard Chartered.
Altcoins Extend Strong Q3 Performance
Major altcoins also moved higher on Thursday after outperforming Bitcoin during the third quarter.
Ether gained around 2% to $2,714.83 after rising approximately 70% during Q3.
XRP increased about 0.8%, while Solana gained roughly 0.9%. Cardano climbed 4.2%, and BNB advanced 1.8%.
Memecoins also posted gains. Dogecoin rose around 2.9%, while the TRUMP token climbed approximately 7.3%.
Bitcoin Enters Q4 With Strong Momentum
Bitcoin enters the fourth quarter with solid momentum following its strong Q3 performance.
However, high Treasury yields, Federal Reserve policy expectations and upcoming U.S. economic data remain key risks for the cryptocurrency market.
For now, Bitcoin continues to trade near the $84,000 level, while investors watch closely for signs that falling inflation could eventually ease pressure from higher interest rates.
