Bitcoin hits new high above $ 69,000 after inflation spikes to 31-year peak

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The price of bitcoin hit a new high and wiped out a day of losses in minutes on Wednesday morning after the Bureau of Labor Statistics revealed that consumer prices in the United States had risen at the fastest rate in more than 30 years. years last month, fueling the inflationary fears that lifted cryptocurrencies. to meteoric new heights during the pandemic.

The price of bitcoin jumped 5% within minutes of the last monthly inflation report.

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Bitcoin, the world’s largest cryptocurrency, hit a new record high of $ 69,044 shortly after 9:15 a.m. ET on Wednesday, according to CoinGecko, eclipsing a record set Tuesday morning; CoinMarketCap and CoinDesk posted record highs of $ 68,742 and $ 68,991 respectively.

Prices skyrocketed by about $ 2,500, or 4%, in about 45 minutes after the Ministry of Labor’s monthly Consumer Price Index report, which showed that consumer prices had risen by d ‘about 6.2% in October on an annual basis, the highest since December 1990 and more than economists expected.

In a Monday note, Bitbank analyst Yuya Hasegawa said the Consumer Price Index report could stoke price concerns and fuel another rise for bitcoin, which has risen alongside inflationary expectations. these last weeks.

Now with a market cap of around $ 1.3 trillion, bitcoin has jumped about 8% over the past week and 346% over the past year, giving it about 42% of the overall combined value of the cryptocurrency market.

Key context

During the pandemic, many investors, from home traders to institutional giants, have turned to cryptocurrencies as a legitimate hedge against long-term inflation problems, which have become evident as massive levels of government spending threaten. the strength of the US dollar. “These emergency measures, like the massive silver printing program, are reducing the value of traditional currencies like the dollar,” said Nigel Green, CEO of the deVere Wealth Advisory Group, in a recent memo. Despite the rise, however, the crypto’s unwavering volatility has only intensified. Although they have since recovered, prices began to plummet in April, when Tesla, one of Bitcoin’s largest commercial investors, revealed that it had sold a large chunk of its holdings and did not would not buy more until Bitcoin mining consumes less energy. Markets have also struggled amid intensifying regulatory repression in China, in part resulting from similar environmental concerns.

Surprising fact

The combined market value of global cryptocurrencies – at around $ 3.1 trillion on Wednesday – has climbed about 600% over the past year.

Further reading

‘Meat flation’ worsens in latest inflation report as beef prices skyrocket to decades-long highs (Forbes)

Ether and bitcoin hit record highs as crypto market surpasses $ 3 trillion (Forbes)

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