Zinger Key Points
- Cryptocurrencies traded slightly higher following the announcement of the May CPI, which showed a decline in inflation.
- Despite ongoing SEC lawsuits against major crypto exchanges, investors are in a wait-and-see mode.
- Discover Fast-Growing Stocks Every Month
Major cryptocurrencies traded slightly in the green on Tuesday, following the announcement by the U.S. Bureau of Labor Statistics that the CPI surged by 4%, better than the projected 4.1% and April’s figure of 4.9%.
| Cryptocurrency | Gains +/- | Price (Recorded 9:30 p.m. EST) |
| Bitcoin BTC/USD | +0.14% | $25,998 |
| Ethereum ETH/USD | +0.23% | $1,743 |
| Dogecoin DOGE/USD | +0.63% | $0.062 |
What Happened: Bitcoin briefly showed signs of optimism as reflected in the May Consumer Price Index (CPI) released on Tuesday, which demonstrated a decline in inflation.
Despite the ongoing Securities and Exchange Commission (SEC) lawsuits against major crypto exchanges Binance and Coinbase, investors appeared to set aside their concerns and awaited the outcome of the latest inflation report and now Wednesday’s Federal Reserve interest rate decision. However, BTC has remained relatively stagnant below $26,000 over the past four days.
Top Gainer (24 Hour)
| Cryptocurrency | Gains +/- | Price (Recorded 9:30 p.m. EST) |
| Injective | +8.97% | $6.20 |
| BNB | +7.61% | $248.60 |
| Fantom | +7.55% | $0.2637 |
At the time of writing, the global crypto market capitalization stood at $1.06 trillion, an increase of 0.30% over the last day.
Stocks soared on Tuesday following the release of the latest inflation data, which revealed a decline in price pressures in May.
Investors were optimistic that this could prompt the Federal Reserve to hold off on any potential interest rate hikes – a move that was reflected in the strong gains of the S&P 500 and the Nasdaq Composite. Both indices closed at their highest levels since April 2022 the previous day, with the Nasdaq Composite chalking up fresh 13-month highs during the session.
See More: Best Crypto Day Trading Strategies
Analyst Notes: “The risk-on rally that stemmed from news that inflation fell to the lowest levels since early 2021 did not give crypto much of a boost. The focus for many traders is when will Altcoins stabilize? Too many key blockchain protocol cryptos are at risk of being deemed a security and that could kill crypto interest in the US," said Edward Moya, Senior Market Analyst at OANDA.
Crypto analyst Michael Van de Poppe predicts a market drop into the FOMC, prompting potential lows. However, he sees the potential for a lucrative trading opportunity in the range of $24,500 to 25,000, making it a great area for longing.
Analyst Chris Burniske, a partner at venture capital firm Placeholder, addressed concerns about the future of crypto. Burniske acknowledged that existential doubts about the industry are natural within market cycles and can lead to major gains over time.
He believes that doubt about crypto’s future in the coming years is crucial for the rise of multiples that will leave investors in awe. "Existential doubt about crypto's future in 2023 is the prerequisite for the types of multiples that people will gawk at in a few years – the specifics of doubt change each bear, but the doubt always emerges. Something that's a consensus long by society doesn't print 10-100xs."
Santiment, the on-chain analytics platform, revealed that the exchange supply of Bitcoin dipped to its lowest level since February 2018. This trend is due to traders moving their BTC holdings to self-custody wallets amid the current uncertainty surrounding Binance and Coinbase. As the SEC lawsuits loom, this shift towards self-custody is likely to persist.
Read Next: Jim Cramer Advises Against Using Binance, Provokes Strong Reactions From Twitter Users
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
