Bitcoin Nearly Reaches $105,000 as Softer-Than-Expected Inflation Bolsters Risk Appetite

Leading cryptocurrencies advanced on Tuesday, as softer-than-expected consumer inflation data boosted risk appetite further.

How Has Cryptocurrency Performed Today?

The global cryptocurrency market cap now stands at $3.38 trillion following a 2.32% increase in the last 24 hours.

Top Movers:

Among the major cryptocurrencies, Ethereum showed strength with a 9% rally in the last 24 hours, pushing it above the $2,700 mark for the first time since February 25.

The relative market dominance of Ethereum has also risen to 9.6%, while Bitcoin's fell to 61%.

The rally wiped out $240 million in bearish bets in the last 24 hours, while total liquidations shot up to $387 million.

Bitcoin's Open Interest went up 0.87% in the last 24 hours, although bets against the cryptocurrency in the Binance derivatives market went up to 59% of the total.

The magnitude of the "Greed" sentiment increased from 70 to 73, according to the Crypto Fear and Greed Index.

The Global Cryptosnapshot

Major stock indexes extended their gains on Tuesday as investors parsed April's softer-than-expected Consumer Price Index data, which suggested that President Donald Trump's tariff measures didn't have an immediate impact on the cost of living.

The risk-on sentiment has also improved after the U.S. and China agreed to slash their retaliatory tariffs.

The S&P 500 rose 0.72% to close at 5,886.55, while the tech-heavy Nasdaq Composite gained 1.61% to end at 19,010.08. The Dow Jones Industrial Average was the outlier, losing 269.67 points, or 0.64%, to end at 42,140.43.

Investors will now turn their attention to Thursday's pending Producer Price Index reading for April. Economists polled by Dow Jones expect a 0.3% increase in the month-over-month PPI for goods.

The Federal Reserve will also release the minutes of its April 29-30 policy meeting on Wednesday. Economists expect the Fed to keep interest rates unchanged at the upcoming June meeting.

Analyst Notes

Cryptocurrency analyst and trader Michaël van de Poppe predicted that the reduced inflation would calm investors and potentially lead to the Federal Reserve lowering interest rates.

"The cocktail for Bitcoin to go ballistic is getting there," he added.

Chris Kline, the co-founder and COO of Bitcoin IRA, said that Bitcoin's run past the $100,000 mark was partly due to the strategic reserve race among states.

"The combination of institutional adoption through ETFs and now governmental reserves creates unprecedented demand pressure against Bitcoin's mathematically limited supply," Kline said.

He added that governments have recognized the power of holding finite digital assets in an era of unlimited fiat currency.