Bitcoin, Ethereum, Dogecoin Surge Despite Hotter-Than-Expected US Inflation: Analyst Predicts Widespread Adoption Would Propel King Crypto To $600K

Major cryptocurrencies experienced a surge on Tuesday evening, in the backdrop of a hotter-than-anticipated U.S. inflation reading that dampened expectations for interest-rate cuts.

What Happened:  The largest cryptocurrency by market capitalization, Bitcoin, experienced a decline of about 1% to $49,500 from its earlier position slightly above $50,000 earlier in the day.

In January, the consumer price index (CPI) increased by 0.3% from December, while on an annual basis, it rose by 3.1%. According to economists surveyed by Dow Jones, the anticipated CPI rise was 0.2% month over month and 2.9% from the previous year.

Core prices, excluding the volatile food and energy components, experienced a 0.4% monthly increase and a 3.9% rise from the previous year. The expected core CPI surge for January was 0.3%, with a 3.7% increase from the previous year.

Top Gainer (24 Hour)

The global cryptocurrency market cap now stands at $1.87 trillion, showing a 3.66% increase in the past 24 hours.

Stocks experienced a decline on Tuesday as hotter-than-expected inflation data for January led to a spike in Treasury yields. 

The Dow Jones Industrial Average closed at 38,272.75, marking a drop of 524.63 points, or 1.35%. Similarly, the S&P 500 slid by 1.37% to conclude at 4,953.17, while the Nasdaq Composite fell by 1.8% to settle at 15,655.60.

Furthermore, the 2-year Treasury yield surged above 4.66%, and the 10-year yield exceeded 4.32% following the release of the CPI data.

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Analyst Notes: Cryptocurrency analyst Michael Van de Poppe has observed that #Bitcoin is undergoing a slight correction following the higher-than-projected CPI.

"Inflow is great, but it’s not a guarantee that it will go up endlessly. As long as #Bitcoin stays above $46K, trend remains up. Good sidenote: ETH/BTC bouncing upwards."

Van de Poppe suggests that Bitcoin and the digital asset market may be on the verge of a “crypto dot-com bubble.” The analyst predicts that widespread adoption of Bitcoin could trigger a substantial rally, potentially propelling the crypto king to well above half a million dollars.

"It could be that we're going to peak at $250,000 or $600,000…"

Cryptocurrency analyst Ali Martinez has pointed out that Bitcoin seems to be shaping an ascending triangle on the lower time frames. "This technical formation suggests BTC is poised for a 1.60% in the short-term. Watch out for the $50,200 resistance and the $50,000 support!"

Photo by Fernando Cortes on Shutterstock

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