Bitcoin drops below $26K after CPI; investors await Fed rate hike decision.

The value of Bitcoin appeared to enjoy the news of decreasing inflation as shown in the May Consumer Price Index (CPI) released on Tuesday. Despite being down by 0.2% over the past 24 hours, trading at $25,846, BTC had briefly peaked over $26,000 after the announcement that the CPI had risen 4%, which was better than the expected 4.1% and April’s 4.9%. Investors remained cautious, anticipating the Federal Reserve’s interest rate decision and ignoring Securities and Exchange Commission (SEC) lawsuits against Binance and Coinbase. The Fed is expected to stop its year-long campaign of monetary hawkishness as the CPI was raging at 8.6% just a year ago, leading to the Federal Reserve increasing the Federal Funds rate by 75 basis points (bps) and sending risk-on assets spiraling. The suits against Binance and Coinbase may force regulators to decide whether cryptos are securities, commodities or otherwise. Ether, the second largest crypto by market value, followed BTC’s lead but returned some of its gains, while other tokens, including ALG and MATIC, increased. Major stock indexes were buoyed by the CPI report, and there were faint signs that the hot jobs market was cooling. However, the economy seems to be trending towards a quarter of negative growth, and if GDP growth continues declining in Q2, the U.S. will find itself on shaky ground.