Market observers expressed more concerns over the Bitcoin price drop amid a significant projected spike in inflation. Amid a massive spike of the United States’ Consumer Price Index (CPI), the cryptocurrency community has divided on whether Bitcoin (BTC) is really a hedge to inflation. The CPI, an indicator measuring the average change in prices that consumers pay for a basket of goods and services, saw its largest one-month increase in June over the past 13 years, Business Insider reported Tuesday. The inflation surge reportedly started in March, when CPI rose by 2.6%, followed by subsequent increases in April of 4.2% and eventually 5.4% in June.
But despite the recent growth in CPI-measured inflation, Bitcoin has allegedly failed as an inflation hedge as its price has almost halved from $64,000 in mid-April, according to some analysts.
“Bitcoin isn’t behaving like an inflation hedge anymore and will continue to remain heavy over expectations over higher yields,” Ed Moya, senior equity analyst at foreign exchange firm Oanda said in a Tuesday note. However, that inflation is viewed as transitory, which could be a reason why the June CPI report wasn’t enough of a catalyst to break Bitcoin’s sideways trading, Moya added.
The crypto community subsequently reacted to these CPI-versus-Bitcoin observations, with many industry advocates emphasizing that their early Bitcoin investment and gains “have already hedged the future.” Some Bitcoin enthusiasts pointed out that Bitcoin has been growing historically, posting massive gains over the long term.
According to some crypto experts, Bitcoin is indeed “not a great hedge against inflation.” Mati Greenspan, founder of money management firm Quantum Economics, told Cointelegraph that there “doesn’t seem to be any correlation” between Bitcoin’s price action and inflation or deflation data, stating:
“Certainly bitcoin has been a great performer over time. But most of the gains have occurred during a great global deflationary period in which all risk assets rose. Now that inflation is picking up for real, for the first time since Bitcoin's inception, it's drastically underperforming.”
The latest CPI-triggered argument brings another twist in long-running debates regarding Bitcoin as a hedge instrument. A number of financial analysts including Nassim Taleb believe that inflation has nothing to do with Bitcoin price. Still, some global investors like Paul Tudor Jones have moved into Bitcoin to protect their investments from inflation.
# | Crypto | Prediction | Accuracy | CVIX | Price | 24h | 7d | Market Cap | 7d price change | |
1 | ![]() |
Bitcoin predictions | 72.8% | 51 | $27 686.50 | -1.54% | 12.26% | $535 055 944 515 | ||
---|---|---|---|---|---|---|---|---|---|---|
2 | ![]() |
Ethereum predictions | 82% | 34 | $1 753.83 | -2.24% | 5.65% | $214 622 976 485 | ||
3 | ![]() |
Tether predictions | 92.4% | 1 | $1.002131 | 0.08% | -0.07% | $77 601 370 004 | ||
4 | ![]() |
Binance Coin predictions | 77.2% | 47 | $324.49 | -3.72% | 0.92% | $51 234 239 201 | ||
5 | ![]() |
USD Coin predictions | 90.4% | 2 | $0.999458 | 0.08% | -0.04% | $34 703 015 524 | ||
6 | ![]() |
XRP predictions | 87.2% | 17 | $0.451417 | -1.31% | 23.74% | $23 000 119 507 | ||
7 | ![]() |
HEX predictions | 62.4% | 82 | $0.123358 | 18.48% | 52.30% | $21 391 630 916 | ||
8 | ![]() |
Cardano predictions | 73.6% | 46 | $0.369965 | -1.76% | 12.89% | $12 844 876 045 | ||
9 | ![]() |
Lido stETH predictions | 94.4% | 1 | $2 941.39 | -0.40% | -3.32% | $10 258 752 564 | ||
10 | ![]() |
Dogecoin predictions | 68.8% | 57 | $0.075005 | -1.31% | 6.24% | $9 950 971 303 | ||
11 | ![]() |
Polygon predictions | 71.2% | 51 | $1.12 | -1.91% | -0.94% | $9 797 674 979 | ||
12 | ![]() |
Solana predictions | 70.4% | 54 | $21.69 | -3.00% | 10.97% | $8 322 389 970 | ||
13 | ![]() |
Binance USD predictions | 94.4% | 1 | $0.999370 | -0.05% | -0.07% | $8 058 942 746 | ||
14 | ![]() |
Polkadot predictions | 74% | 51 | $6.17 | -2.34% | 2.98% | $7 212 834 820 | ||
15 | ![]() |
Litecoin predictions | 68.4% | 58 | $87.92 | 8.34% | 11.30% | $6 377 673 020 |
Get cryptocurrency price predictions, forecasts with analysis and news right to your inbox.
© 2015-2023 Crypto-Rating.com
The usage of this website constitutes acceptance of the following legal information. Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website, including information about the cryptocurrencies and bitcoin is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Crypto Rating shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about cryptocurrencies. The entire responsibility for the contents rests with the authors. Reprint of the materials is available only with the permission of the editorial staff.