The reports of cryptocurrency’s demise, much like those of Mark Twain, have been greatly exaggerated. Just look at what happened to Bitcoin (BTC-USD) in the last few days, as it’s rallied to the highest prices since last June. This can be attributed to the consumer price index (CPI) data that showed inflation increased by 0.4% month-over-month in February and 6% year-over-year.
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Although inflation is still high, that’s actually good news this time around; the Labor Department noted that the 6% jump was the lowest increase since September 2021. That may be getting people to feel a little better about the hits they’ve been taking in the grocery store, the gas pump, and everywhere else they need—or just want—to spend money. It also helps functionally reduce the chance of further rate hikes; fighting inflation is one of the biggest reasons for such hikes. If inflation is already in decline, there’s little point in further hikes.
While that’s certainly likely to help out, an array of other events is making bitcoin and its various cousins look a lot more attractive. Starting off with a series of bank catastrophes—including banks that provided infrastructure for bitcoin and other crypto stocks—and carrying on with job cuts, increasing uncertainty, and a geopolitical melting pot that makes dollar alternatives look like a good idea.
Looking at the last three months of bitcoin trading, we can see that the upward movement that started just days ago continues to gain momentum. It’s still well off its 52-week highs, but for the first time in a while, it’s starting to look like it might be able to make a play for those highs once more.
