The price of the flagship cryptocurrency Bitcoin ($BTC) has over the last 24 hours surged significantly to surpass the $26,000 mark in a move that saw the crypto sector greatly outperform other risk assets, including equities markets.
Bitcoin got a helping hand today from the Bureau of Labor Statistics, a unit of the United States Department of Labor. According to a press release that it issued at 12:30 p.m. UTC on March 14, “the Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in February on a seasonally adjusted basis, after increasing 0.5 percent in January.”
JUST IN: 🇺🇸 US Consumer Price Index (CPI) rose 6% year-on-year in February
— CryptoGlobe (@CryptoGlobeInfo) March 14, 2023
Today’s CPI announcement makes it easier for the Federal Reserve to pivot by starting to lower interest rates, which is what it needs to do to help out many U.S. banks that could collapse if it continues to focus on fighting inflation by raising interest rates.
The cryptocurrency market’s rapid rise has triggered over $300 million in liquidations in just 24 hours, with several other major digital assets also making double-digit gains in a short period of time.
Most liquidations occurred as short sellers were unable to cover their positions on multiple cryptocurrency trading platforms, including Binance, OKX, Bybt, Huobi, and BitMEX. Most of the liquidations occurred on leading cryptocurrency exchange Binance.
The cryptocurrency market rally came after a panic caused by a stablecoin crisis, that saw the value of the second-largest stablecoin, USDC, plunged to $0.87 after it was revealed $3.3 billion of its reserves were kept on the now-defunct Silicon Valley Bank.
Crypto prices rallied and USDC restored its peg after the Federal Deposit Insurance Corporation (FDIC) stepped in and revealed depositors would be made whole. The crisis led to various opportunities in the space, with pseudonymous on-chain research team “Lookonchain” commenting on the highly profitable trading behavior of one “very smart” whale that is controlling 15 ETH addresses, which made $4.14 million by trading ETH.
