Bitcoin Gains Following Powell’s Jackson Hole Speech

Bitcoin price gained on Friday as markets reacted to Federal Reserve Chair Jerome Powell’s address at the Jackson Hole symposium.

A broader risk-off move in financial markets weighed on crypto, while Bitcoin was also dented by fears of more token distributions by defunct exchange Mt. Gox.

Bitcoin added 2.4%, climbing to $61,773.0 by 12:57 ET (17:57 GMT).

Earlier in the day, crypto markets were somewhat spooked by a sharp appreciation in the Japanese yen after Bank of Japan Governor Kazuo Ueda warned that interest rates could rise further. This strength in the yen had unwound a carry trade earlier in August, battering most risk-driven markets. Bitcoin had also slumped as low as $49,000.

Impact of Mt. Gox and Powell’s Speech

Bitcoin was set for a middling weekly performance, with the token seeing short-lived breaks above $60,000 amid persistent concerns over Mt. Gox. Wallets associated with the exchange were seen mobilizing nearly $3 billion worth of tokens this week, heralding more distributions.

The exchange began returning tokens stolen during a 2014 hack back to clients in early July, raising concerns over a mass sale event in Bitcoin due to increased token supplies.

A risk-off move in broader financial markets also weighed, as Wall Street indexes ended lower on Thursday. Markets turned cautious before Powell’s address. However, his comments, stating that “The time has come for policy to adjust,” resulted in gains for Bitcoin and other cryptocurrencies on Friday.

Traders are broadly pricing in a rate cut in September, with differing opinions on a 25 or 50 basis point reduction according to CME Fedwatch. The case for a deeper cut was furthered by weak labor market data released earlier in the week, raising concerns that a weakening labor market may affect economic growth.

Altcoin Performance

Broader cryptocurrency prices rose on Friday but were also headed for a middling weekly performance as a rebound from early-August losses ran dry. The world’s second-largest token, Ether, rose by 2.77% to $2,678.07, while altcoins SOL, ADA, and MATIC climbed between 0.1% and 3.5%. XRP is up around 0.5%, and among memecoins, DOGE jumped by 4.6%.

Bitcoin Mining Insights

According to a research report by JPMorgan on Friday, the value of the remaining 1.3 million Bitcoins left to be mined is estimated at about $74 billion.

JPMorgan adjusted its price targets for several mining companies it covers, reflecting second-quarter earnings and recent shifts in both Bitcoin’s price and the network’s hashrate, which measures the total computational power used to mine and validate transactions on a proof-of-work blockchain.

The bank lowered its price target for CleanSpark (NASDAQ: CLSK) shares from $12.50 to $10.50, maintaining a Neutral rating. It also reduced the price target for Iren from $11 to $9.50 but retained an overweight rating. Marathon Digital (NASDAQ: MARA)’s price objective was cut from $14 to $12 with an underweight rating, and the target for Riot Platforms (NASDAQ: RIOT) was trimmed from $12 to $9.50, although the stock remains overweight-rated.

The report estimates the four-year block reward revenue opportunity at around $37 billion, marking a 19% decline since early June, but an 85% increase compared to the previous year.

JPMorgan favors Iren and Riot, noting the recent underperformance of these stocks may offer a buying opportunity. Riot has lagged year-to-date due to operational challenges, but the bank anticipates improved sentiment and potential share price gains in the coming months as metrics improve.

Ambar Warrick contributed to this article.