The US has just announced the Consumer Price Index (CPI) for February 2023, an inflation measure of the world’s largest economy. US inflation measured 6% in Feb, down from Jan’s 6.4%, in line with economists’ expectations.
Bitcoin appeared to react positively to the data as its price jumped to $26,386, a new high of 2023 and also the highest value since June 2022.
Just 4 days ago, on March 10, BTC was still trading around the $19,500 mark due to a series of bad news, including:
- Fed Chair Powell said interest rates might be higher than previously anticipated;
- Silver Bank announced shutdown;
- New York government accused ETH of being a security, sued KuCoin exchange;
- U.S. Treasury Department Proposed 30% Excise Tax on Crypto Mining Firms;
- Voyager was found to be selling assets, the US Department of Justice objected to Voyager-Binance deal;
- US authorities was suspected of transferring 9,861 BTC to Coinbase;
- And lastly, Silicon Valley Bank collapsed, the second-largest stablecoin USDC lost its dollar peg that put more pressure on BTC price.
Circle, on March 12, assured investors it would honor the peg despite exposure to failed Silicon Valley Bank. USDC then recovered to $0.96 at that time. On March 13, the US government stepped in and pledged to compensate all depositors at Silicon Valley Bank, including Circle. The cryptocurrency market has since recovered strongly, bringing BTC to $22,600, and USDC also returned to $1 peg. Till now, BTC has recorded a 35% increase in the past 96 hours, or over $6,800 in value.
Ethereum (ETH) also rallied nearly 11% to $1,765, which is also the new peak of 2023 and the highest value threshold since September 2022. Most altcoins with a large market cap are also increasing by 5-10% following the upward momentum of BTC. The market capitalization reached 1.120 billion USD, recovering strongly from 930 billion USD at the end of last week.