Bitcoin (BTC) will need to see a decrease in inflation in the United States in order to surpass its previous all-time highs reached in March, according to a crypto analyst. Markus Thielen, the head researcher at 10x Research, stated that if inflation prints at 3.3% or lower, Bitcoin is likely to make a new all-time high. Thielen made this prediction ahead of the release of the Consumer Price Index (CPI) results by the United States Bureau of Labor Statistics (BLS) on June 12. He believes that spot Bitcoin exchange-traded funds (ETF) inflows will remain strong in anticipation of the CPI results. However, if the CPI results turn out to be higher than expected, momentum could weaken, as seen earlier this year.
In the past two weeks, spot Bitcoin ETF inflows have been positive, with the highest day of total inflows reaching $305.7 million on May 21. Thielen argues that Bitcoin’s price movements are not random and are driven by critical factors, with inflation being the main driver. There have been instances this year where Bitcoin’s price declined following higher-than-expected CPI results. For example, on April 10, when the CPI was printed at 3.5%, just 0.1% higher than expected, Bitcoin’s price dropped 6.67% to $56,000 a few weeks later.
Thielen also noted that when spot Bitcoin ETFs launched on January 11, despite a strong inflow of $611 million on the first day, the rest of January’s inflows were disappointing. He attributes this to higher-than-expected CPI results, which were 3.4% compared to the expected 3.2%. Thielen stated that it is not a coincidence that Bitcoin was weak in January and stronger in March but consolidated for two months.
It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research before making any investment or trading decisions.