The price of Bitcoin ($BTC ) pierced the level of 65,000 dollars this Tuesday, after an analysis was released projecting a bleak outlook for the U.S. economy due to the advance of artificial intelligence.
The price of the most important cryptocurrency in the market was at 63,331 dollars early in the day, representing a decline of 3.6% in the last 24 hours, according to data provided by CoinDesk.
Other digital assets also suffered the impact of this trend. Ethereum (ETH), the second most popular currency, fell by 2.6%, while the well-known altcoin $XRP ($XRP) recorded a drop of 2.5% during the same period.
This adjustment in valuations seems to have been triggered by a report from Citrini Research that went viral over the weekend. The document details the tensions that artificial intelligence could create in the labor market.
The report describes a discouraging scenario in which technology unleashes a race towards precariousness in knowledge-based jobs, which would ultimately trigger an unprecedented wave of mass unemployment.
Specifically, the study presents a hypothetical case in which the adoption of artificial intelligence raises the unemployment rate in the U.S. to double digits by mid-2028, as explained by Jim Reid, strategist at Deutsche Bank.
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As a result, a new liquidation occurred in the shares of companies perceived by the market as being at risk from technological disruption. This overall recalibration often drags cryptocurrencies, which continue to react to macroeconomic factors.
Digital assets maintain their sensitivity to the same economic forces affecting equity markets. Thus, technological uncertainty quickly translates into the virtual currency ecosystem.
So far this year, cryptocurrencies have struggled to find upward momentum. A drastic change in global financial conditions is likely required for the sector to reverse its current situation.
FAQs
1. What factor caused Bitcoin to fall below 65,000 dollars?
The dissemination of a report from Citrini Research projecting mass unemployment in the U.S. due to artificial intelligence deteriorated market sentiment. Bitcoin fell by 3.6%, settling at 63,331 dollars.
2. Why does the cryptocurrency sector react to news about the labor market?
Digital assets maintain a high sensitivity to the same macroeconomic forces affecting equities. Uncertainty about future economic stability accelerates preemptive liquidations across the crypto ecosystem.
3. What is required for the digital asset market to resume its upward trend?
The sector needs a drastic change in global financial conditions that modifies the current uncertainty scenario. For now, the lack of clear impulses keeps Bitcoin, Ethereum, and XRP in a phase of weakness and searching for support.
-Dan Pentagram