Bitcoin Dominance Flexes Back Toward 60% While Crypto Traders Lean Risk-On 🟢

Bitcoin traded above $86,000 at 9:10 UTC on Oct. 2, up 3.4% over 24 hours, with ether (ETH) at $2,745.22, XRP, solana (SOL) and BNB also advancing, though none matched the leading cryptocurrency's pace. The day's sharpest moves came further down the market-cap rankings, where SKY, AAVE and APT climbed 7% to 10% to lead the 100 largest tokens by market value. Bitcoin's share of the total crypto market capitalization is closing in on 60%, while USDT's share has slipped to roughly 6.3%, a combination that points to capital rotating out of stablecoins and back into risk assets.

The rally comes ahead of Friday's U.S. nonfarm payrolls report, due at 8:30 a.m. ET, which economists expect to show the economy added 90,000 jobs in September, down from 162,000 in August, with the unemployment rate forecast to hold at 4.1% according to FactSet's consensus. Traders are watching the data and the Oct. 14 consumer price index release primarily for their effect on longer-dated Treasury yields, particularly inflation-adjusted, or real, yields. "I am watching Friday's payrolls and the 14 October CPI mainly for their effect on longer-dated yields. I use a 10-year real yield of about 3% as a monitoring level, and a sustained move above it would make a retest of $80,000 to $82,000 more likely than a run at $90,000," said Oliver Carding, head of marketing at Tesseract Group, which manages $500 million in assets.

Rate-hike expectations have eased after dovish remarks from New York Fed President John Williams and Fed Vice Chair Philip Jefferson, with markets now pricing a 30% chance of an October rate increase, down from 70%. A stronger-than-expected payrolls print could revive hike bets and pressure risk assets, including bitcoin.

In the derivatives market, bitcoin open interest rose to $22.4 billion from $20.9 billion a day earlier, while funding rates ticked higher, indicating traders are adding leveraged bullish positions. Still, $344 million in liquidations over the period underscored the elevated risk of volatility heading into the jobs data.