Bitcoin drops below $80,000 following stronger-than-expected US jobs numbers

Friday brought a slide in bitcoin after August labor data came in above forecasts, pointing to an accelerating U.S. job market.

The top digital asset changed hands near $79,764, having fallen as low as $78,706 during the New York morning. Over the past 24 hours it is down more than 1%. The previous day had seen the token climb above $82,000.

A tight labor market generally makes the Federal Reserve more inclined to lift interest rates, since a larger employed population tends to drive up spending, and stronger spending can stoke inflation.

Kevin Warsh, the Fed chair, delivered his first major address since taking charge of the U.S. central bank last week, telling listeners there was "more work to do" in the fight against inflation. Historically, bitcoin has fared well when interest rates are low.

At the upcoming September 15–16 policy meeting, traders roughly see a 50% to 60% probability of a U.S. rate increase.

However, U.S. President Donald Trump pressed the Federal Reserve on Friday to cut interest rates sharply.

In a post on Truth Social, Trump wrote: "Lower the interest rates because the U.S.A. is a much stronger credit than it was just a short time ago!"

He went on: "We should have the LOWEST RATE of any country in the World, like 'the old days.'"

Recently, bitcoin has moved independently of equities as investors worry once more about dollar debasement.

Last month, after the U.S. Treasury Department said it would more than double the size of its government debt repurchases, the cryptocurrency started to surge. The run was the best in three years and made for the coin's third-best August ever.

Analysts say the so-called debasement trade has returned to center stage, with bitcoin moving in tandem with gold. That trade involves buying an asset as protection against a currency losing value.

There was also news last month that U.S. public debt had topped $40 trillion for the first time. Heavy debt erodes faith in the dollar as well, which makes holdings such as bitcoin and gold more appealing.