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Bitcoin hit by record inflation in the US
Bitcoin Loses Over $2,000 From Thursday's Highs
Feb 11, 2022
1 min read
Anna BakkerNews analyzer

BTC fell along with risky assets after the release of US inflation data.

Cryptocurrencies were on Thursday under the pressure of strong data on inflation in the United States, which has updated highs in 40 years. The data could force the Fed to raise interest rates faster, which is negative for all risky assets, including cryptocurrencies.

During trading, bitcoin showed high volatility, initially refreshing early January highs above $45,800 under the influence of a weakening dollar. However, then the first cryptocurrency began to decline along with stock indices.

Ratings agency Fitch has downgraded El Salvador due to its acceptance of bitcoin as legal tender. In March, the country will issue the first $1 billion Bitcoin bonds.

The world's largest investment company BlackRock is about to launch a cryptocurrency trading service. Bank Of America refuses to recognize bitcoin as a safe-haven asset and points to a strengthening correlation between BTC and the S&P 500 stock index. JPMorgan believes that the “fair” price of bitcoin at the moment is $38,000.

According to CoinShare, institutional investors have been investing in crypto funds for the third week in a row. Why did they start doing this even before the January meeting of the Fed, when no one believed in the likelihood of a BTC reversal. Crypto whales also bought bitcoin in the fall. According to Santiment, they have purchased 220,000 bitcoins in the last seven weeks.

The Government of the Russian Federation has completed the preparation of a draft law on the circulation of digital currencies. The Ministry of Finance of the Russian Federation proposed to establish a transitional period for individuals before the introduction of a tax on income from cryptocurrencies.

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