Gold Surges as Bitcoin Slumps Amid Risk Aversion: Crypto Market Update

The Crypto Daybook Americas is taking a temporary hiatus, resuming on January 5, and wishes its readers a wonderful holiday season. The current market sentiment remains gloomy ahead of the US GDP data release, expected to show a stable economy in the third quarter. Despite a declining dollar index, which typically favors risk assets like cryptocurrencies, the market is experiencing a weak tone. Bitcoin has dropped to $87,500 after failing to sustain gains above $90,000, with all 16 CoinDesk indexes down over 24 hours. The DeFi Select and metaverse indexes have seen significant drops of 4% and 3%, respectively. Only HASH and RAIN among the top-100 tokens by market cap have seen gains exceeding 6% in the past 24 hours. The decline in the dollar index, which has fallen below 98.00, would normally boost risk assets but is instead accompanied by a rally in gold and other precious metals, indicating a shift in risk attitude. According to Alex Kuptsikevich, chief market analyst at FxPro, this change in risk attitude, also reflected in the sell-off of global bonds, may lead to further declines in cryptocurrencies and increased risk aversion in stocks and developing country currencies. The US Bureau of Economic Analysis is set to release its preliminary estimate for the third-quarter GDP, with most economists predicting a 3.2% annualized growth rate. A weaker-than-expected result could potentially reignite demand for Bitcoin, although sustaining prices above $90,000 may be challenging. Traditional markets show little change, with futures for the S&P 500 and Nasdaq indicating a lack of clear direction. Gold continues to rally, approaching $4,500 per ounce, while the yen has strengthened against the dollar on speculation of the Bank of Japan's potential intervention in FX markets.