Recently, the U.S. January Consumer Price Index (CPI) increased more than expected, causing investors to worry that the Federal Reserve might delay interest rate cuts, leading the cryptocurrency market to briefly fall into panic. However, after a brief fluctuation, the market rebounded strongly, with Ethereum (ETH) and Binance Coin (BNB) leading the way, overall market sentiment strengthened, and investor confidence quickly rebounded.
Ethereum rises 6%, ETF staking progress becomes a catalyst
According to CoinGecko data, the current trading price of Ethereum is $2,739, up 6% in the last 24 hours, but still has a certain gap compared to the January high of $3,700.
Presto Research analyst Min Jung pointed out that the recent rise in Ethereum is closely related to Cboe BZX's application to open ETF staking functions. Cboe recently submitted a 19b-4 document to the U.S. Securities and Exchange Commission (SEC) seeking to modify the terms of the Ethereum ETF under 21Shares to allow for staking of held Ethereum.
Min Jung stated, 'Currently, a major pain point for Ethereum ETFs is the inability to participate in staking. If the SEC approves this move, it will be a significant shift for the market.'
The market generally believes that under the promotion of the 'Crypto 2.0' policy, the SEC's regulatory attitude will be more friendly than during the tenure of former chairman Gary Gensler, which has also led to great expectations for the approval of Ethereum ETF staking.
BNB surges unstoppable, rising 13% in a single day
Meanwhile, BNB rose 13% in the past 24 hours, reaching a price of $711, with a market capitalization exceeding $102.7 billion, successfully surpassing Solana (SOL) to become the fifth-largest cryptocurrency by market cap.
BTC Markets analyst Rachael Lucas believes that the rise of BNB is mainly a 'technical rebound'. On February 6, BNB plummeted to $500 due to a market liquidation wave, but given BNB's historical trend, $500 may be viewed as an important support level. When market sentiment stabilized, buying surged in, driving a strong rebound in prices.
Min Jung also noted that Binance recently listed several meme coins (such as TST, CHEEMS). Additionally, founder Zhao Changpeng (CZ) has been vigorously promoting BNB Chain on social media, which may also be catalysts for the rise of BNB.
The market digests inflation data, and panic sentiment cools down
The cryptocurrency market briefly fell into panic due to the U.S. January CPI data exceeding expectations. Data showed that the CPI increased by 0.5% month-on-month, marking the largest monthly increase in two years, deepening market concerns about the Federal Reserve possibly delaying interest rate cuts.
However, as the market calmed down, investor panic gradually eased. Min Jung stated, 'Although the market reacted violently after the CPI report was released, investors then began to view the data more rationally and realized that more economic indicators are needed to confirm the inflation trend.'
Rachael Lucas believes that this market rebound is closely related to 'algorithmic trading'. Trading bots are extremely sensitive to keywords such as Federal Reserve statements and CPI data, and once market sentiment stabilizes, they automatically execute buy orders, further pushing up cryptocurrency prices.
Risk assets are warming up, and the market is brewing a new round of gains
Rachael Lucas pointed out that investors have gradually alleviated their concerns about tariff policies and inflationary pressures, beginning to digest the latest CPI data. The strong rebound of major cryptocurrencies shows that capital confidence is returning. The overall risk asset market's positive response to the global economic environment suggests that if liquidity conditions continue to improve, the market may welcome the next wave of upward trends.
In addition, Min Jung added that U.S. President Biden recently revealed that Russian President Putin has agreed to discuss the possibility of ending the war in Ukraine, further enhancing market risk appetite and driving up asset prices.
As market sentiment gradually recovers, investor confidence is strongly returning, and the cryptocurrency market may welcome a new round of increases in the future. Major cryptocurrencies like Ethereum and BNB may continue to lead the market rebound, and the recovery of other assets is also worth paying attention to.
