Bitcoin News Today: Bitcoin Falls 4.2% After Hot Inflation Data Dampen Rate-Cut Hopes

Bitcoin’s record-breaking ascent to an all-time high of over $124,000 in early August 2025 did not last long. Within hours of hitting this peak, the cryptocurrency began a sharp pullback, shedding more than $5,800 in value and retreating to levels near $118,427. This rapid correction erased gains accumulated over the previous two days and raised questions about the sustainability of the bullish momentum driving the market [1][2].

The initial surge was largely fueled by growing optimism around potential Federal Reserve rate cuts. Investors linked Bitcoin’s performance to broader financial market trends, as equities such as the S&P 500 and Nasdaq also reached record highs. The rise in Bitcoin mirrored this optimism, with many viewing the cryptocurrency as a beneficiary of looser monetary policy [3].

However, the correction followed hot economic data, particularly inflation figures, which cast doubt on the likelihood of immediate rate cuts. The release of the Producer Price Index (PPI) and other inflationary signals dented market sentiment, leading to a sharp sell-off. By midday on Thursday, Bitcoin had fallen more than 4.2%, pushing the price down to around $118,100 [4][5].

The volatility was not limited to Bitcoin. The broader crypto market also experienced a pullback, with investors holding off on further purchases in anticipation of the upcoming Consumer Price Index (CPI) report. This data is seen as a key indicator for the Fed’s future monetary policy and is likely to shape the next phase of market movements [6].

In addition to macroeconomic factors, market sentiment was further shaken by extreme volatility in related assets. For instance, Bullish, a crypto exchange operator, saw its stock surge over 90% during its public debut, triggering trading halts. Such erratic movements in the wider crypto ecosystem may have contributed to a cautious stance among traders [7].

Despite the sharp drop, analysts have not ruled out a return to higher levels. The underlying factors supporting Bitcoin’s long-term trajectory—such as corporate adoption and increasing institutional interest—remain intact. However, the recent correction underscores the sensitivity of crypto markets to macroeconomic developments, particularly those related to central bank policy [1][3].

Source:

[1] The Cryptobasic - [https://thecryptobasic.com/2025/08/14/heres-why-bitcoin-has-corrected-4-despite-reaching-an-all-time-high-today/](https://thecryptobasic.com/2025/08/14/heres-why-bitcoin-has-corrected-4-despite-reaching-an-all-time-high-today/)

[2] CaptainAltcoin - [https://captainaltcoin.com/bitcoin-btc-price-pulls-back-after-hitting-124k-heres-whats-driving-the-drop/](https://captainaltcoin.com/bitcoin-btc-price-pulls-back-after-hitting-124k-heres-whats-driving-the-drop/)

[3] Economic Times - [https://m.economictimes.com/markets/cryptocurrency/bitcoin-at-124k-reaches-all-time-high-heres-what-experts-say/articleshow/123296817.cms](https://m.economictimes.com/markets/cryptocurrency/bitcoin-at-124k-reaches-all-time-high-heres-what-experts-say/articleshow/123296817.cms)

[4] Seeking Alpha - [https://seekingalpha.com/news/4485490-bitcoin-drops-after-hot-wholesale-inflation-data-dampen-fed-rate-cut-bets](https://seekingalpha.com/news/4485490-bitcoin-drops-after-hot-wholesale-inflation-data-dampen-fed-rate-cut-bets)

[5] MSN - [https://www.msn.com/en-us/money/markets/bitcoin-xrp-fall-why-cpi-inflation-data-could-halt-the-crypto-rally/ar-AA1KmsLu](https://www.msn.com/en-us/money/markets/bitcoin-xrp-fall-why-cpi-inflation-data-could-halt-the-crypto-rally/ar-AA1KmsLu)

[6] MSN - [https://www.msn.com/en-us/money/markets/bitcoin-drops-3-after-touching-record-highs-as-crypto-rolls-over/ar-AA1Kxjdp?ocid=finance-verthp-feeds](https://www.msn.com/en-us/money/markets/bitcoin-drops-3-after-touching-record-highs-as-crypto-rolls-over/ar-AA1Kxjdp?ocid=finance-verthp-feeds)

[7] Economic Times - [https://m.economictimes.com/news/international/us/bullish-ipo-latest-news-bullish-breaks-the-market-stock-jumps-90-triggering-circuit-breaker-and-m-cap-hits-10-billion-crypto-news/articleshow/123304062.cms](https://m.economictimes.com/news/international/us/bullish-ipo-latest-news-bullish-breaks-the-market-stock-jumps-90-triggering-circuit-breaker-and-m-cap-hits-10-billion-crypto-news/articleshow/123304062.cms)