Bitcoin briefly reclaimed the $87,000 level for the first time since September 23, driven by weaker-than-expected U.S. employment data and a significant regulatory proposal from the Securities and Exchange Commission (SEC). After trading near $84,500 to $85,000, the cryptocurrency surged past $87,000 before settling near $85,188, maintaining a daily gain.
The upward price movement was accompanied by substantial liquidations in the derivatives market. According to Coinglass data, $142 million in bitcoin short bets were liquidated over a 24-hour period, compared to approximately $29 million in long positions.
Labor Data and Monetary Policy
The price rally coincided with the release of September nonfarm payrolls data from the Bureau of Labor Statistics, which showed that the economy added just 29,000 jobs—significantly below the anticipated 90,000. The unemployment rate also rose to 4.2%.
The weaker employment figures led markets to reprice expectations for future Federal Reserve interest rate decisions, causing a pullback in the U.S. Dollar Index and Treasury yields. A softer labor market and potential monetary easing reduce the opportunity cost of holding non-yielding assets like bitcoin, while a weakening U.S. dollar provides traditional market tailwinds for the cryptocurrency.
SEC Proposes Modernized Custody Framework
In addition to macroeconomic data, traders reacted to a new regulatory proposal from the SEC concerning how investment advisers and funds may hold digital assets. The agency acknowledged that previous custody frameworks created compliance difficulties due to a lack of available traditional custodians for crypto assets.
Under the new proposal, investment advisers and funds would be permitted to hold client crypto assets directly under strict guardrails if third-party qualified custodians are unavailable. The SEC has opened a 60-day public comment period following the proposal's publication in the Federal Register, providing potential legal clarity for fiduciary holdings and institutional participation.
