Cryptocurrencies: Ethereum Soars to Nearly $4,500 After U.S. Inflation Data
Altcoins showed mixed performance, with notable gains led by Chainlink (+8.2%), Solana (+5.5%), and Cardano (+5.4%).
Quick overview
- Following better-than-expected U.S. inflation data, the cryptocurrency market is mostly positive, with Ethereum rising over 4% while Bitcoin slips 0.4%.
- Core inflation exceeded projections at 3.1%, leading to cautious sentiment among traders and increased demand for short-term put options.
- Institutional interest in cryptocurrencies is growing, highlighted by Harvard's $116 million investment in BlackRock's Bitcoin ETF.
- Geopolitical developments, including a potential meeting between Trump and Putin, are contributing to improved risk sentiment in global markets.
Following slightly better-than-expected U.S. inflation data, the cryptocurrency market is mostly in the green—though Bitcoin slips 0.4%.
U.S. annual inflation came in at 2.7% in July, just below analysts’ expectations and matching June’s reading. In contrast, core inflation rose 3.1%, exceeding projections. In crypto trading, Ethereum surged more than 4% in the past 24 hours to hover near $4,500, while Bitcoin edged down 0.4% to $119,270, according to Binance.
Altcoins showed mixed performance, with notable gains led by Chainlink (+8.2%), Solana (+5.5%), and Cardano (+5.4%).
A cautious but bullish crypto market
Analysts say recent profit-taking reflects a cautious sentiment. Demand is growing for short-term put options in the $115,000–$118,000 range as a defensive hedge against downside moves.
According to Augustine Fan, head of research at SignalPlus, BTC’s implied volatility remains near historic lows, while ETH’s has risen sharply. “A month ago, the market saw only a 5% chance of ETH reaching $4,500 in August; today, prices have already far exceeded those expectations,” he noted.
Optimism is supported by mounting expectations that the Federal Reserve will start cutting rates in September. Weak U.S. macroeconomic data and President Donald Trump’s push to reshape the Fed in line with his vision have fueled bets on up to three rate cuts before year-end.
Institutional appetite grows
Institutional interest in cryptocurrencies continues to climb, as reflected in fresh inflows into spot BTC and ETH ETFs. One standout move came from Harvard, which invested $116 million in BlackRock’s iShares Bitcoin ETF—viewed by analysts as a long-term vote of confidence and a potential support for prices during market pullbacks.
However, analysts warn that the ongoing U.S.-China trade war remains a risk, though the tariff truce was extended for another 90 days.
On the geopolitical front, Trump confirmed a meeting with Russian President Vladimir Putin in Alaska on August 15 to explore a ceasefire or peace deal to end the war in Ukraine. While the outcome remains uncertain, such developments have helped ease risk sentiment in global markets.
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