Why is the crypto market down today? The CPI data aftermath

In this post:

  • Bitcoin and the entire crypto market take a nosedive following the Consumer Price Index (CPI) released yesterday.
  • Today morning, two wallets linked to the US government – With Silk Road BTC holdings- moved $300 worth of BTC, bringing a negative sentiment to the crypto market.
  • Some analysts believe it is only a matter of time before Bitcoin starts its partial recovery from a crypto meltdown in 2022.

After a slight decline yesterday, both the Bitcoin (BTC) price and the crypto market cap displayed bearish indications. The current Bitcoin price, according to CoinMarketCap, is $30,595.80. B TC has a 24-hour trading volume of $14,855,555.780 million. In the past twenty-four hours, Bitcoin has declined by 0.33 percent. 

According to CoinGecko, the current global crypto market cap stands at $1.24 Trillion, a change of 0.01% over the past 24 hours and a change of 33.84% over the past year. Bitcoin’s market cap is $595 billion as of today, representing a 48.13 percent market share. The market cap of Stablecoins is $128 billion, representing a 10.34% share of the total crypto market cap.

Crypto markets take a nosedive

In the immediate aftermath of a marginally surprising decline in the Consumer Price Index (CPI) for the month of June on Wednesday, Bitcoin appeared to be on an upward trajectory. This was before it retreated into the shadows, where it has resided for the better part of a month at well below $31,000.

BTC surged in the hour following the release of the CPI, which showed a 3% increase that was less than anticipated and down from 4% the previous month, as investors lost their enthusiasm. 

After halting a year-long diet of monetary hawkishness in June, Federal Reserve officials have repeatedly stated that they intend to raise interest rates by 25 basis points later this month.

Two wallets labeled as belonging to the United States government and linked to seized crypto holdings from the Silk Road marketplace moved 9,825 worth of bitcoin ($301 million) in three transactions this morning, which may have outweighed the positive inflation report.

Ether also rose after the release of the CPI report before falling to $1,870, down 0.6% from Tuesday at the same time. MATIC and AVAX, the tokens of smart contracts platforms Polygon and Avalanche, declined by more than 4% and 2%, respectively. The Crypto Market Index, a measure of the performance of crypto markets, fell 1.9%.

Some observers believe that U.S. overreach could shift the crypto world’s equilibrium to foreign cities with friendlier regulatory environments, such as Hong Kong, which recently made it easier for retail investors to trade, Singapore, and Abu Dhabi, which aims to become a global digital asset hub.

Will BTC survive the current market?

In a July 11 tweet, the well-known trader Moustache wagered that BTC price history would repeat itself. This year, Bitcoin’s formerly strong inverse correlation to dollar strength has weakened, but its most recent movements have traders in a debate.

According to on-chain data, the U.S. dollar index (DXY) is on the verge of testing support at 100 for the first time in months. According to Moustache, Bitcoin stands to gain as a result of its newfound negative sentiment, which would be further cemented if the 100 threshold is breached.

Markets keen to capitalize on a probable reversal in US interest rate hikes haven’t helped the dollar’s cause. Despite a hawkish Federal Reserve, this appears to be becoming more likely.

The crypto market declined this month following a June surge fueled by a flurry of applications by investment giants such as BlackRock Inc. to launch US exchange-traded funds that invest in the token’s spot market. Investors are currently pondering whether Bitcoin’s 83% recovery this year still has a place for growth.

Bitcoin and a gauge of the top 100 digital tokens both fell, in stark contrast to the attitude in other asset classes. Some analysts believe it is only a matter of time before Bitcoin starts its partial recovery from a crypto meltdown in 2022.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.

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