Inflation data relay PPI, how does the Federal Reserve's "dovish eagle swing" make BTC experience a roller coaster market?

Macro interpretation: The US CPI data released last night can be regarded as a "fireworks show" in the financial market. The core CPI rose 0.446% month on month, far exceeding the expected 0.3%, shattering the market's illusions about the Fed's March interest rate cut. This wave of data not only caused the US dollar index to soar to a high of 108, but also led to a 10 basis point jump in US bond yields, vividly demonstrating the drama of "inflation never dies, bulls never die". What's even more interesting is that the market is like a wall grass repeatedly jumping sideways - US stock futures and gold first perform free fall, and then staged a fierce rebound, perfectly interpreting the inner turmoil of traders. Upon closer inspection of the data details, the price of second-hand cars suddenly surged by 2.19%, jokingly referred to as the "Renaissance of the second-hand car market"; The California wildfires not only burned the sky red, but also ignited car insurance prices, causing a month on month surge of 1.99% in motor vehicle insurance; Even more magical is that unpopular items such as hospitals, parking fees, and even club membership fees have collectively gone viral, being mocked by analysts as the masterpiece of the "January Business Retaliative Price Increase Alliance". However, the Federal Reserve is not a vegetarian either. It quietly adjusted the CPI quarterly adjustment factor as a "beauty filter", making the inflation data of the past three months look more "silky". As a result, it pushed up the base of this period's data in reverse, which can be regarded as a model of "data magician". In terms of market reaction, the expectation of interest rate cuts was directly beaten up - the first interest rate cut was postponed from July to September, and the number of interest rate cuts throughout the year has shrunk to a pitiful 1.06 times. But don't rush to sing negative, the combination of the base effect and housing inflation from February to April may bring a wave of surprise to bulls. However, by the second half of the year, Trump's three piece package of tax cuts, tariffs, and immigration policies will begin to take effect, and the Federal Reserve may not even be able to find the microphone to cut interest rates.

Turning our attention to tonight's PPI data, the market has taken on a posture of 'dead pigs are not afraid of boiling water'. Despite analytical warnings of the possible "January effect" and tariff disruptions, the market seems to be more addicted to the "Trump Putin friendly call" meme. The current expected PPI monthly rate is 0.3%, and the core annual rate is 3.3%. If this exceeds expectations again, traders are likely to resort to a "selective blindness" tactic. After all, Powell just played a "Tai Chi" in Congress, acknowledging that inflation is close to the target and emphasizing that there is no rush to cut interest rates. This "Schr ö dinger's dovish" attitude has given the market more room for interpretation than a black hole. It is worth pondering that despite the macro level clouds, the cryptocurrency market is like a Popeye eating spinach. Pantera partners shouted '2025 is the year of cryptocurrency's tailwind', ARK even threw out the rumor of 'BTC sword pointing at $300000', and the founder of Base was busy refuting rumors of ETH selling, like an old hen protecting her cubs. These favorable factors are like putting bulletproof vests on Bitcoin, allowing it to still bounce happily in the rain of interest rate hikes from the Federal Reserve.

When Macro Storm Meets Crypto Carnival: The Magical Realism Script of BTC. At present, Bitcoin is standing at a crossroads, with liquidity anxiety caused by the Federal Reserve's delayed interest rate cuts on one hand, and a continuous infusion of cryptocurrency native benefits on the other. In the short term, a strong US dollar and high interest rate environment may make BTC stumble like a drunkard, but don't forget its inherent "anti inflation" persona - when traditional assets are ravaged by inflation, the story of digital gold is even more tempting. Even more ingenious is the mysticism of market expectation management. Although the CPI in January knocked down the expectation of a rate cut, the futures market still stubbornly left a 12.9% chance of a rate cut in May. This subtle psychological game is like guessing the size in a casino - knowing that the winning rate is not high, but always wanting to try a miracle. If tonight's PPI data is unexpectedly "gentle", coupled with Powell's vague statement about the "unpredictable impact of trillion dollar spending cuts", it is enough to make the long and short sides fight for another 300 rounds. In the long run, Bitcoin is playing a big game. Institutions have upgraded from "sneakily buying" to "openly shouting orders", and the ambition of stablecoin scale to reach $1.4 trillion is building a moat. Even if the Federal Reserve becomes a 'rate hike maniac', the wealth creation effect of the crypto world may still attract hot money to hide behind closed doors. After all, while traditional financial markets were playing the game of "inflation hitting groundhogs," Bitcoin had already installed rocket boosters on itself. The collision between this macro policy and the crypto revolution may ultimately evolve into a ridiculous drama of 'you hit yours, I'll raise mine'. After all, in the crypto world, faith can sometimes be more lethal than the Federal Reserve's balance sheet.

Data analysis: Coinank data shows that according to reports, the total trading volume of CEX in 2024 reached $18.83 trillion, an increase of 134% from $8.05 trillion in 2023, but still lower than the historical high of $25.21 trillion in 2021. Despite a significant rebound in trading volume in 2024, it has not yet returned to the peak level of the bull market in 2021. The competitive landscape of the cryptocurrency trading market is evolving, with emerging exchanges rapidly rising and established exchanges experiencing a decline in market share. We believe that from the perspective of market evolution, although the trading volume of centralized exchanges will double year-on-year to the level of $18.8 trillion in 2024, there is still a 23% gap compared to the historical peak in 2021, reflecting the structural differentiation characteristics of the recovery of the cryptocurrency market. The data shows that the entry of institutional funds (such as spot ETFs approved) and the innovation of derivative tools have driven the recovery of liquidity in this cycle, but the leverage demand of retail investors has not been fully activated, resulting in weaker overall activity than the previous bull market. The changes in the competitive landscape are more worthy of attention. Emerging exchanges are seizing market share through regional license layouts, zero transaction fee strategies, and on chain asset integration, while traditional platforms are constrained by rising regulatory compliance costs and user migration pressures. This dynamic balance reflects the trend of the cryptocurrency market transitioning from extensive expansion to refined operation, and liquidity is evolving from a top monopoly to a multipolar distribution. It is worth noting that the scissors gap between trading volume and market value growth implies an increase in market maturity - longer holding periods for investors and reduced short-term speculative behavior. However, we need to be vigilant about the systemic risks that may arise from the high proportion of derivatives (currently over 70%). In the future, CEX needs to explore new growth points such as asset issuance and revenue instruments within a compliance framework to break through the current trading volume ceiling.