The latest U.S. inflation data has reignited investor interest in risk assets, particularly Bitcoin, as the Consumer Price Index (CPI) report revealed a 0.4% increase in December. While this was slightly higher than the previous month, the core CPI, excluding food and energy, dipped to 3.2% from 3.3%. This unexpected decline in core inflation has fueled speculation that the Federal Reserve might consider rate cuts sooner than anticipated, enhancing Bitcoin's appeal as a hedge against inflation. The anticipation of potential rate cuts has led to a surge in Bitcoin's price, as investors seek to capitalize on the favorable macroeconomic conditions. The broader cryptocurrency market has mirrored Bitcoin's gains, with significant increases observed across various altcoins.
The ProShares UltraShort Bitcoin ETF (SBIT) experienced a notable decline, dropping 5.94% to $10.13 at 11:20 AM on Wednesday, January 15.