Key Takeaways
Bitcoin (BTC) fell 5.7% to $77,204 as of 4:19 p.m. AEST, as hotter-than-expected U.S. inflation data prompted investors to scale back bets on a near-term Federal Reserve interest rate cut.
"The crypto market historically hits a major cycle peak 12 to 18 months after the network cuts mining block rewards in half, a pattern that played out following the 2024 halving," Sam Daodu, a crypto analyst at 24/7 Wall St., said. "Following the October 2025 cycle peak, conservative projections factoring in institutional demand place the next major macro ceiling between $135,000 and $150,000."
The sell-off was triggered by April's Consumer Price Index (CPI), which, according to the Australian Bureau of Statistics, showed a 4.6% annual increase. This was compounded by the U.S. Producer Price Index (PPI) for April, which rose 1.4% month-over-month, nearly triple the 0.5% expected by economists. The persistent inflation pushed the 10-year Treasury yield to its highest level since last July, near 4.48%, making lower-risk assets more attractive. The bearish sentiment was reflected across markets, with the ASX 200 falling 1.3% to 8,496 points.
The shift in rate-cut expectations creates a challenging environment for risk assets like Bitcoin. With borrowing costs expected to remain elevated, capital may continue to flow away from more volatile investments. The market is also digesting a leadership change at the Federal Reserve, with the Senate confirming Kevin Warsh to replace Jerome Powell as chair. Warsh is expected to bring a new approach to monetary policy, potentially leading to more contentious debates on interest rate decisions. For now, analysts suggest the next realistic peak for Bitcoin lies between $135,000 and $150,000, a target that balances institutional buying pressure against the headwind of a restrictive macroeconomic environment.
This article is for informational purposes only and does not constitute investment advice.
