Bitcoin, Cryptocurrencies Drop After Japan’s Coincheck Breached

2018-01-29 05:00:00

Talking Points:

Bitcoin, other cryptocurrencies drop after Japan’s Coincheck breach
US Dollar edges higher as markets digest after Trump-inspired spike
Franc falls as FinMin says US is not planning FX-related sanctions

Bitcoinfell as much as 4.2 percent and other leading cryptocurrencies including Ether, Litecoin and XRP also lost ground following news that Coincheck – one of Japan’s largest digital exchanges – was robbed of over $500 million in NEM coins. Hackers penetrated the venue’s systems early Friday. NEM is the tenth-largest cryptocurrency by market value.

The US Dollar retraced cautiously higher having retreated against its major counterparts on Friday. That move was itself corrective, unwinding a surge inspired by supportive comments from President Donald Trump. He signaled that his administration favors an “ultimately” strong domestic currency, countering comments from Treasury Secretary Mnuchin that seemed to praise depreciation as a boost for exports.

The Swiss Franc fell after Finance Minister Ueli Maurer said the US is “not planning any sanctions” linked to the country’s FX policy in an interview with SonntagsZeitung. “They know our situation and understand,” he added. The US Treasury Department has singled out Switzerland on a list of countries it monitors especially closely for signs of what it deems to be unfair exchange rate manipulation.

A quiet European data docket is likely to see investors looking ahead to US news-flow, where the Fed’s favored PCE inflation gauge is due to cross the wires. The core year-on-year price growth rate is expected to print at 1.5 percent in December, matching the five-month high recorded in November. The release is unlikely to generate fireworks regardless of the outcome however as the FOMC rate decision looms ahead.

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