On Wednesday, November 10, the Bitcoin price shot up significantly to a new all-time high of $69,000 soon after the U.S. reported a 6.2% surge in the Consumer Price Index (CPI). This shows that inflation in the United States has been growing up at the fastest rate since the 1990s.
Affected by the CPI data just announced, Bitcoin broke through a record high of $69,000. pic.twitter.com/bu8lplFv6Y
— Wu Blockchain (@WuBlockchain) November 10, 2021
The rise in the BTC price was pretty obvious considering that the digital asset serves as a strong inflation hedge. Sui Chung, chief executive of CF Benchmarks told Bloomberg that Bitcoin has been enjoying a sustained rally over the last few months and much recently on the launch of the Bitcoin Futures ETF last month.
But Chung adds that the rising inflation across all the major global economies of the world can provide an additional fuel to the Bitcoin price rally. Some of the biggest players on Wall Street have been participating in this Bitcoin price rally owing to the onflation fears.
Furthermore, Bitcoin’s hedge rival Gold has largely underperformed as an inflation hedge over the last year and so. As a result, Bitcoin is finding more acceptance among big players.
Bitcoin (BTC) Enters Sharp Correction
Although the BTC price topped $69,000 on Wednesday, it sustained for a very short period. Bitcoin entered a sharp correction dropping nearly 10% all the way to the bottom of $64,000. This resulted in massive liquidations across the market. As explained by crypto journalist Wu Blockchain:
In the past 12h, Bitcoin broke through 69,000 and then began to fall to a minimum of 64565. The short-term rise and fall resulted in over 450 million U.S. dollars in liquidation within 4 hours, and over 680m in 12-hour liquidation.
The journalist further explains that the decline in the BTC price followed the sharp correction in the U.S. stocks. The Nasdaq Composite (INDEXNASDAQ: .IXIC) tanked 1.66% by the closing hours of the market. It will be interesting to see whether if BTC finds a base at $64,000 and starts its upwards journey from here on.