Bitcoin pulls back to $64K after Korea rate hike, traders watch U.S. reports

Blockchain investigator ZachXBT criticized hardware wallets as bitcoin traded near $65,000 after South Korea’s central bank raised interest rates.

U.S. Data Shows Slower Spending but Strong Employment

U.S. retail sales increased 0.2% in June, matching expectations but slowing from May’s 1% monthly gain.

Excluding autos, retail sales fell 0.2%, slightly missing forecasts for a 0.1% decline and reversing the previous month’s strong growth.

The labor market remained resilient, with initial jobless claims dropping to 208,000 last week, below estimates of 217,000 and down from 216,000 in the prior week.

Manufacturing activity also improved, as the Philadelphia Fed’s July survey jumped to 41.4 from 10.3 in June, significantly exceeding expectations for a reading of 13.

Markets showed little reaction to the reports, with bitcoin holding near $64,100 while Nasdaq futures remained down about 0.9%.

CoinDesk 20 Index Slips as Crypto Markets Weaken

The CoinDesk 20 Index declined 1.1% from the previous U.S. market close, trading at 17,561.14.

Uniswap led gains with a 2% increase, followed by Stellar, which rose 1%. Bitcoin Cash was among the biggest decliners, falling 2.9%, while Aave dropped 2.2%.

Only three of the 20 assets in the index were trading higher.

Nasdaq Futures Fall Ahead of Key Economic Reports

Nasdaq futures dropped 0.6% Thursday, alongside a nearly 1% decline in bitcoin prices.

Asian markets also struggled, with South Korea’s Kospi plunging more than 6% and Japan’s Nikkei losing nearly 2%.

The weakness followed South Korea’s first interest-rate increase in more than three years, as policymakers warned that inflation pressures remain persistent.

Investors are now watching U.S. retail sales and jobless claims data for clues on whether the economy is cooling enough to ease inflation without triggering a deeper slowdown.

Bitfinex Says Bitcoin Rally Is Driven by Macro Factors

Bitcoin’s move toward $65,000 appears to be largely fueled by macroeconomic developments rather than strong crypto-specific demand, according to Bitfinex analysts.

The firm said June’s softer inflation data reduced expectations of a July Federal Reserve rate hike, lowering the probability to around 12% from 42%. Declining two-year Treasury yields also supported gains across bitcoin, equities, and other risk assets.

However, analysts pointed out that bitcoin lacks strong spot demand. U.S. spot bitcoin ETFs recorded about $425 million in outflows on July 13, Strategy made no new bitcoin purchases, and the Coinbase premium remained negative.

Bitfinex described the rally as “borrowed strength,” warning that gains driven mainly by macro conditions may struggle to continue without consistent buying pressure.

Bitcoin Holds Steady After South Korea Rate Hike

Bitcoin remained just below $65,000 on Thursday after the Bank of Korea raised its benchmark rate by 25 basis points to 2.75%.

The central bank said inflation could stay elevated as higher energy costs continue to flow through the economy. South Korea’s annual inflation rate rose to 3.2%, its highest level since 2023.

The Korean won strengthened to around 1,480 per dollar following the rate decision, extending its recovery from roughly 1,560 two weeks earlier. Bitcoin remained mostly unchanged against the currency, with BTC/KRW trading above KRW 94.96 million on Upbit.

South Korea remains one of the world’s most active crypto markets, supported by a large retail investor base known for speculative trading activity.

ZachXBT Questions Hardware Wallet Reliability

Crypto investigator ZachXBT criticized existing hardware wallet solutions, arguing they are not secure or practical enough for managing large crypto holdings.

He claimed current devices fall short in both security and usability, making them unsuitable for high-value transactions.

Instead, ZachXBT recommended using a dedicated iPhone solely as a signing device for crypto operations, arguing that the setup could provide better control and fewer risks.

He also targeted Ledger, criticizing frequent Ledger Live updates that change interfaces and applications while sometimes causing functionality issues.

The remarks sparked debate across the crypto community, with users sharing their experiences and discussing the strengths and weaknesses of different hardware wallet options.