The crypto market is experiencing significant events related to inflation in the US, recent liquidations, and Bitcoin's fight for market positions.
Inflation and Its Impact on Cryptocurrencies
The U.S. Producer Price Index (PPI) has risen to 3.3%, exceeding analysts' expectations. This indicates persistent inflationary pressure that may slow down Federal Reserve rate cuts. The potential outcome could be bearish for risk assets like Bitcoin, as tighter monetary policy limits liquidity.
Liquidation Wave in the Crypto Market
The crypto market saw a $420 million liquidation wave within 20 minutes, likely triggered by the liquidation of leveraged long positions. This rapid forced selling highlights the fragile state of market sentiment and prices amidst sudden changes.
Bitcoin's Market Cap Positions
Before the recent news wave, Bitcoin briefly overtook Google (Alphabet) in market capitalization, becoming the 5th largest asset globally, valued at around $2.456 trillion. However, current rankings suggest BTC may have slipped slightly below Google again, though the gap remains narrow and could shift with market moves.
Recent inflation data, mass liquidations, and lack of policy support combine to weaken short-term demand and momentum for Bitcoin.
