TL;DR
- Bitcoin’s price dropped by 1.91%, while Ethereum and other cryptocurrencies also saw significant losses due to an unexpected rise in inflation in the U.S. for January.
- The Consumer Price Index (CPI) increased by 3% year-over-year, surpassing analysts’ expectations, raising concerns about potential persistent inflation.
- Despite the decline, many analysts remain optimistic about cryptocurrencies in the long run, highlighting that inflation could drive more interest in assets like Bitcoin.
The cryptocurrency market has faced a notable decline in recent hours, with Bitcoin, Ethereum, and other major cryptocurrencies experiencing substantial losses after the release of U.S. inflation data. Bitcoin’s price fell by 1.91%, settling at approximately $95,066, while Ethereum dropped even further by 2.88%, reaching $2,578. In general, the crypto market has been significantly impacted by the unexpected surge in inflation during January, a development that caught many investors and analysts completely off guard.
The Consumer Price Index (CPI) reported an annual increase of 3%, exceeding market expectations, which had forecasted a 2.9% rise. This marks a sharp rebound compared to the 2.4% inflation recorded in September of the previous year. Despite signs of inflation slowing down in recent months, this report suggests that price pressures may persist, creating growing uncertainty in the markets, including cryptocurrencies.
Price and Performance of Leading Cryptocurrencies
Regarding the performance of the leading cryptocurrencies, Bitcoin suffered a 1.91% drop, reaching a price of $95,066. This decline reflects the immediate and significant impact of the inflation data on the market. Ethereum followed a similar trend, experiencing an even greater fall of 2.88%, with its price dropping to $2,578. Solana, on the other hand, saw a considerable drop of 4.43%, taking its price down to $190.43, while XRP plummeted by 3.73%, reaching $2.37.
Despite these downturns, some assets such as BNB showed a slight increase, rising by 0.25% to $637.91. However, other popular tokens such as Dogecoin and Cardano also saw significant losses. Dogecoin lost 3.33%, touching $0.2497, while Cardano fell by 3.13%, reaching $0.7674. TRON also experienced a drop of 2.10%, with a price of $0.2402.
Looking ahead, many experts believe that cryptocurrencies will remain an attractive investment option, especially in a high-inflation economic environment. As central banks struggle to maintain price stability, assets like Bitcoin, which are not subject to government manipulation, may gain even more relevance as a store of value, potentially driving increased interest, confidence, and long-term investment.
