Why Bitcoin, Ethereum, and Dogecoin just surged

Today's CPI report turns out to mean a great deal to crypto investors.

| More on:
Two happy excited friends in euphoria mood after winning in a bet with a smartphone in hand.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Bitcoin (CRYPTO: BTC) has made another notable 24-hour move today, increasing 2.6% since 4 p.m. ET yesterday (as of 1:30 p.m. ET), with Ethereum (CRYPTO: ETH) and Dogecoin (CRYPTO: DOGE) also catching a bid, surging 3.8% and 4.4, respectively, over the same time frame.

These moves have taken Bitcoin back toward the pivotal $100,000 mark, with the world's largest digital asset continuing to hover around this critical level. Ethereum's and Dogecoin's outsize moves make sense in the context of the larger dynamics that are typically at play with respect to these three megacap projects, but let's dive into what's happening beneath the surface and driving such broad momentum in the crypto market as a whole and for these three projects in particular.

It's a macro day, baby

Most of the discussion on traditional media (and social media platforms as well) this morning revolves around today's Consumer Price Index (CPI) report, which came in lower than expected. Core CPI unexpectedly declined one-tenth of 1%, leading to a surge in interest among investors for higher-growth and more speculative asset classes.

Of course, the fact is that overall inflation at 2.9% is still meaningfully higher than the Federal Reserve's target, and there are concerns around Trump's potential tariff plans and how the bond market will continue to react to potentially higher deficits and growth over the next four years.

But with this lower-than-expected core reading, the market now has priced in a greater likelihood of continued interest rate cuts. These implied cuts have put pressure on the U.S. dollar and improved the risk-reward outlook for risk assets, all factors that should benefit megacap cryptocurrencies such as Bitcoin (which is more tethered to currency movements than the other two), Ethereum, and Dogecoin.

Are animal spirits ahead?

On a day when there's relatively little in the way of token-specific catalysts, sometimes market sentiment tied to macro conditions easing is enough to provide a rising tide that lifts all boats. And given that crypto as an asset class is about as far out on the risk spectrum as most traditional investors are willing to go, today's outsize moves (which are greater than the moves seen in most indexes today) reflect this reality.

Aside from the impact on the U.S. dollar this CPI report is likely to have (which will benefit Bitcoin), all risk assets should benefit from longer-term yields heading lower. That's because the 10-year U.S. Treasury yield is most often viewed as the appropriate discount rate for equities and other risk assets. For crypto investors with a long-term investing time horizon, discounting future growth to the present requires some sort of interest rate, and this is the particular figure most investors are paying close attention to right now.

I think if macro conditions continue to soften, and investors believe that more accommodative monetary policy is on the horizon, it's possible animal spirits could roar back once again. Bitcoin, Ethereum, and Dogecoin are each widely considered to be quality digital assets by their associated communities. Perhaps today's CPI report is what they needed to hit the bid once again.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Should you invest $1,000 in Bitcoin.ℏ right now?

Before you buy Bitcoin.ℏ shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Bitcoin.ℏ wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Chris MacDonald has positions in Ethereum. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin and Ethereum. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Cryptocurrencies

Bitcoin coins in a pile.
Cryptocurrencies

What's happening with the Bitcoin price amid the Trump tariff market panic?

You may have heard Bitcoin referred to as ‘digital gold’. But is it really a haven asset?

Read more »

A graphic picture of gold Bitcoins with the Bitcoin symbol lying on a desk with arrows shooting higher and one arrow lifting off the flat surface pointing to the sky.
ETFs

Dip your toes into cryptocurrency with these 2 ASX ETFs

Interested in cryptocurrency?

Read more »

Bitcoin symbol with a rising green arrow.
Cryptocurrencies

Bitcoin surges: How to invest through the ASX

Wanting to gain exposure to the cryptocurrency? Check out these two options.

Read more »

Bitcoin coins in a pile.
Cryptocurrencies

Here's what owning Bitcoin for 7 years has taught me

Bitcoin has been a fantastic investment for me, but not without its pitfalls.

Read more »

A woman holds a bitcoin token in her hand as she smiles at the camera in the background.
Cryptocurrencies

Bitcoin price surges on Donald Trump's cryptocurrency strategic reserve update

The Bitcoin price hit all-time highs of US$109,115 on the day Trump was sworn into office.

Read more »

Bitcoin coin with a rising arrow.
Cryptocurrencies

The Bitcoin price soared 120% in 2024. Could it repeat that performance in 2025?

Bitcoin soared by 150% in 2023 and 120% in 2024, so many crypto investors are expecting it to once again…

Read more »

Bitcoin coin with a rising arrow.
Cryptocurrencies

Bitcoin price smashes new record highs as market value tops US$2.1 trillion

Bitcoin just soared to new all-time highs. But why?

Read more »

a businessman rips open his shirt superman style to reveal the bitcoin logo on a superhero style lycra suit under his clothes.
Cryptocurrencies

Bitcoin price reclaims US$100,000 after AMP reveals an investment

A rising Bitcoin price could validate AMP’s recent investment decision.

Read more »