As Bitcoin’s (BTC) value plummets, market watchers are eagerly anticipating the U.S. nonfarm payrolls report on Friday, hoping it might halt the cryptocurrency’s downward spiral. The leading digital currency fell below $54,000 early Friday amid reports that Mt. Gox, a defunct exchange, moved $2.6 billion worth of BTC, purportedly for creditor repayments. Mt. Gox later confirmed it had begun these repayments, which caused a muted response in Bitcoin’s price.

Currently, Bitcoin is down over 13% for the week, marking the most significant weekly decline since the collapse of FTX in November 2022, according to data from CoinDesk and TradingView.

The Crucial Nonfarm Payrolls Report

The U.S. Bureau of Labor Statistics is set to release the nonfarm payrolls (NFP) report for June on Friday at 12:30 UTC. Economists surveyed by FactSet anticipate the report will show an addition of 190,000 jobs in June, a substantial decrease from May’s 272,000 additions. The unemployment rate is expected to remain steady at 4%.

In a potentially encouraging sign for inflation, average hourly earnings growth is forecast to slow to 0.3% in June from 0.4% in May, translating to a year-on-year rise of 3.9%, down from May’s 4.1%.

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Market Implications and Fed Rate Cut Speculations

Macro traders, who have been increasingly active in the BTC market since 2020, are particularly focused on the timing and number of Federal Reserve rate cuts. Following last Friday’s soft U.S. PCE inflation data, traders have nearly priced in two rate cuts for this year, according to the CME’s FedWatch tool.

Jag Kooner, head of derivatives at crypto exchange Bitfinex, noted that dovish, pro-risk asset expectations could intensify if Friday’s jobs data shows weaker-than-expected growth. “If the NFP report indicates softer job growth, it might heighten expectations for future rate cuts, potentially boosting Bitcoin prices as investors look for alternative assets amid a more lenient monetary policy,” Kooner told CoinDesk via email.

Kooner also explained that inflows into spot Bitcoin ETFs listed in the U.S., favored by macro traders and institutions, could accelerate if market participants believe economic uncertainty will push the Fed towards eventual rate cuts.

However, Kooner cautioned that the extent of these inflows will be influenced by overall market sentiment and appetite for risk assets. “Significant inflows would hinge on broader market sentiment and risk appetite. Lately, we’ve seen quite lackluster flows and a paucity of ‘dip-buying’,” Kooner remarked. “Should the job market appear more robust, Bitcoin might encounter downward pressure as the likelihood of near-term rate cuts diminishes.”