Bitcoin edged down 2% to $101,880 on Thursday but maintained a position close to a three-week peak following a surprising drop in U.S. inflation data for April. The cryptocurrency remained firmly above the critical $100,000 threshold, bolstered by growing optimism over easing trade tensions between the U.S. and China, though cautious sentiment capped further gains.
The easing of global trade friction, marked by a joint U.S.-China agreement to temporarily roll back tariffs, helped alleviate fears of a looming global economic slowdown. This, combined with U.S. consumer price index figures coming in below expectations, fueled hopes for a Federal Reserve interest rate cut later this year. Nevertheless, analysts warned that the Fed would remain vigilant, prioritizing inflation control and awaiting clear economic signals before adjusting policy.
Adding to the softer inflation outlook, the U.S. Producer Price Index (PPI) unexpectedly declined 0.5% in April, led by the sharpest drop in wholesale service prices since 2009. Wholesale service costs, including air travel and hotel stays, fell 0.7%, reflecting weakened demand. On a yearly basis, PPI growth slowed to 2.4%, down from 3.4% in March. These figures may prompt economists to revise downward core inflation forecasts for April.
Amid these macroeconomic shifts, markets currently price in a possible Fed rate cut by September, though some experts predict a later timeline.
In related market news, Israel-based trading platform eToro made a notable Nasdaq debut, with shares surging 34% above the IPO price to a $5.6 billion valuation. eToro’s platform combines stock and cryptocurrency trading with social investing features, reflecting growing investor enthusiasm amid potential favorable crypto regulations.
However, not all news was positive. Coinbase Global, the first major crypto firm included in the S&P 500, disclosed a cyberattack impacting customer data, which led to a 5% decline in its share price. The breach, involving unauthorized access to internal documents and customer names and addresses, could cost the company up to $400 million. Coinbase rejected a $20 million ransom demand and instead offered a bounty for information while cooperating with law enforcement.
Meanwhile, altcoins suffered notable losses on Thursday. Ethereum dropped 2.7% to $2,515.54, XRP tumbled nearly 5% to $2.43, Solana declined around 5%, and Cardano plunged roughly 7%. Meme tokens also fell sharply, with Dogecoin down 5% and $TRUMP falling 5.7%, signaling a broader pullback after earlier rallies.
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