Crypto market rises on softer inflation, but can the gains hold?

Bitcoin and the overall crypto market got a much-needed (and very welcomed) jolt this morning following February’s CPI report, which was softer than expected. Inflation increased 0.2% for the month, or 2.8% annually. The consensus had been 0.3% and 2.9%, respectively.

Aside from bitcoin, some cryptos surged even more following the report, including dogecoin and Solana, which are both up about 3% as of 10 a.m. ET.

The rally is also lifting stocks of bitcoin-heavy companies like Strategy and MARA Holdings, as well as platforms popular with crypto traders like Robinhood and Coinbase. (Robinhood Markets Inc. is the parent company of Sherwood Media, an independently operated media company.)

Now, whether this will be the catalyst needed to revive the crypto market for the long term remains to be seen. Bitcoin (and most other cryptos and crypto-related stocks) have been hit since the tepid and uneventful inaugural White House Crypto Summit that followed Trump’s executive order on the national bitcoin reserve. 

Reactions to this morning’s rally are muted. 

Chris Chung, founder of solana-based swap platform Titan, said that while cryptos are looking green across the board today, fears over the impact of tariffs and the potential for a US recession still hang heavy over markets.

“This puts somewhat of a lid on the rally,” Chung said.

Bitcoin is down 24% since its all-time high of $109,114 on Inauguration Day. And the latest boost could be short-lived as nervous investors await more clarity on the economy’s outlook. 

Nic Puckrin, founder of Coin Bureau, told Sherwood News that after an initial pump, he expects both bitcoin and the stock market to remain in the doldrums until macroeconomic prospects look clearer.

“If Trump is as hellbent on forcing Fed Chair Jerome Powell into cutting rates sooner rather than later, then more pain is likely in store for risk assets until he gets what he wants,” Puckrin said. “The current recession fears and uncertainty won’t let bitcoin or stocks go significantly higher from here.”