Ethereum
Bitcoin, a better option than Ethereum amid inflation respite?
The Federal Reserve has decided to leave interest rates unchanged. The Consumer Price Index in the United States [CPI] data revealed that inflation remained at 0.3% in May. This again exceeded market expectations. Investors were eagerly awaiting this inflation data to take stock of the state of the American economy. Additionally, cryptocurrency investors were also evaluating this data while closely monitoring Bitcoin. [BTC].
With inflation cooling faster than expected, Bitcoin managed to rake in $1,500 within seconds of the news. BTC reached a high of $69,411.3. However, this did not last very long as the royal coin fell back to the $67,000 level. Despite this decline, many continue to bet big on BTC. 10x Research affirmed its optimism around BTC and a potential rally. Markus Thielen said,
“Our recommendation remains unchanged: stay with the winners [Bitcoin] and avoid others [such as Ethereum]. Our previous analysis showed that a lower CPI tends to drive Bitcoin prices higher, and we expect this trend to continue.
The rest of the market also saw moderate uptrends. Ethereum [ETH] for example, it jumped 3% to a high of $3,652.
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How does this help Bitcoin?
The research report also highlights that spot Bitcoin exchange-traded funds [ETF] in the United States saw significant inflows during the slowdown in inflation. Thielen reminded the market that ETF flows only ended their dry spell after December CPI rose in January. He further added,
“ETF flows turned positive in late January, but only began to accelerate slightly before the CPI data was released on February 13. But when inflation rose again to 3.2% on March 12, Bitcoin ETF inflows stopped as the market shrugged off the narrative of 2-3 rate cuts.
At press time, Bitcoin was trading at $67,368.95 after a daily decline of 0.12%. The asset continues to rule the market with its market capitalization of $1.33 trillion.
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