Bitcoin, the largest cryptocurrency, has taken in its stride the collapses of SVB and Signature Bank over the weekend, and Silvergate Bank earlier this month, all key banking partners for a number of crypto firms.
Helping the asset on Tuesday, analysts said, was U.S. consumer price data that showed inflation still rising, but at a slower pace than the previous month. The widely anticipated reading may lead the Federal Reserve to slow or even pause hiking interest rates next week. "CPI data being in line with expectations has been very supportive for interest rate sensitive crypto assets such as bitcoin," said James Butterfill, head of research at digital asset manager CoinShares.
Other factors have also helped bitcoin, said Richard Usher, head of over-the-counter trading at London crypto firm BCB Group, citing a move by the Binance exchange to convert its $1 billion industry recovery fund to tokens including bitcoin.
"With CPI falling in line with expectations today and the recent fall in global yields signalling that interest rate hikes may be pared back, we have broken $25,000 with $28,000 the first target," said Usher. (Reporting by Elizabeth Howcroft and Tom Wilson, editing by Sinead Cruise and Susan Fenton)
