“BTC Drops in Advance as Highly Anticipated CPI Data is Released”

Tuesday,
The volatility before the halving continues to dominate the cryptocurrency market, with investors adopting a wait-and-see attitude ahead of tomorrow’s release of the US Consumer Price Index (CPI) report. After surging yesterday, BTC turned into a downward trend, falling below $69,000 at one point, causing significant damage to altcoins.
The US stock market remained sluggish for most of the day, with the S&P 500 and Nasdaq indices ending slightly positive, up 0.14% and 0.32% respectively, while the Dow Jones Industrial Average remained flat at the close.
According to data from Bitpush, Bitcoin has been in a downtrend since reaching a peak of $72,800 on Monday, hitting a low of $68,200 during the day and then rebounding above $69,000. As of the time of writing, the BTC trading price is $69,118, with a 24-hour decrease of 3.57%.
The altcoin market has been severely hit by the Bitcoin correction, with only 10 out of the top 200 tokens experiencing a price increase of over 2%. Theta Fuel (TFUEL) saw the highest increase, up 24.5%, followed by Saga (SAGA) with a 10.4% increase, and MX Token (MX) with a 9.4% increase. Meme coin Dogwifhat (WIF) experienced the largest decrease, down 14.9%, followed by Arkham (ARKM) with a 13.9% decrease, and Wormhole (W) with a 13.5% decrease.


Regulatory Uncertainty Disrupts the Crypto Market
On that day, Wally Adeyemo, the Deputy Secretary of the US Treasury, claimed in his testimony to the Senate Committee on Banking, Housing, and Urban Affairs that an increasing number of malicious actors are using cryptocurrencies to evade economic sanctions, and the Treasury Department needs expanded powers to effectively combat illegal crypto financing.
He stated that the main issue is that the use of cryptocurrencies and decentralized finance (DeFi) allows bad actors to “hide their identities and transfer resources through virtual currencies.” Despite the Treasury Department’s best efforts, “malicious actors” are still “seeking new ways to transfer resources,” such as through cryptocurrency mixers or over-the-counter digital asset exchanges.
For these reasons, Adeyemo called for the establishment of “an enforcement regime that can prevent this activity, as more terrorists, transnational criminals, and rogue states turn to digital assets.”
After the statement was released, the crypto market’s decline expanded, as US regulatory developments remain one of the key influencing factors in the market.
Sunny Lu, the founder of VeChain, believes that changing regulations will affect the trajectory of Bitcoin after the upcoming halving event. In an interview, he stated, “If we compare this cycle with the previous one, the impact of regulation becomes obvious.”
Sunny Lu expressed that investors’ attention has shifted from a traditional understanding of the halving’s impact based solely on supply dynamics to considering broader macroeconomic factors. He said, “The mathematical principles of the halving are becoming less important. The halving essentially leads to price increases due to reduced supply, but it is increasingly influenced by macro forces.”
Expected Volatility
Currently, the futures market predicts a 57% chance of a rate cut by the Federal Reserve in June and a 74% chance in July.
Market analyst Bloodgood stated in the latest update, “The recent macro environment in the US has been oscillating between hopes for the perfect ‘golden girl scenario’ of a soft landing and concerns about resurging inflation, forcing monetary policy to adopt a more hawkish stance. The current market sentiment seems to be leaning towards bearish. Regardless, all eyes are focused on the CPI to be released tomorrow, with a consensus forecast of 3.5%. Given the market’s concerns that the Fed may signal a dovish move too early—although it is still unclear when the rate cut will ultimately happen—any unexpected inflation higher than expected will have an impact on the market.”
Bloodgood warned investors that although Bitcoin “successfully closed above key levels” last week, there has been a lot of indecision recently as neither bulls nor bears have been able to follow through after a breakout in either direction. He advised investors to proceed with caution, especially if they have any open leveraged positions.
Bloodgood pointed out, “There hasn’t been much change except for Bitcoin returning to the $70,000 level. The timing is uncertain because we are immediately halving BTC after creating a new ATH—this is not what the usual cycle looks like—so we are definitely in uncharted territory.”


Michaël van de Poppe, the founder of MN Trading, stated on the X platform that in the short term, Bitcoin may trade sideways and consolidate until a certain time after the halving.
Currently, the total market capitalization of cryptocurrencies stands at $2.6 trillion, with Bitcoin’s dominance at 52.3%.
Author: BitpushNews Mary Liu
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Tags:
2023 market trend
CPI
halving
altcoins
Bitcoin
money laundering
bull market
regulation
Federal Reserve
virtual assets
Treasury Department
inflation
Note: All Bitpush articles represent the author’s views and do not constitute investment advice.
Original Article Link: https://www.bitpush.news/articles/6590450
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