Bitcoin Holds in $60,000 Range Despite Cooling U.S. Inflation, Potential for Explosive Rally After Short-Term Lull

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As Bitcoin (BTC) investors find their patience pushed to the limit amid the unexpected macro trend of slowing inflation, an expert has offered a provocative assessment that the current downturn is merely a smokescreen masking currency depreciation and that an explosive surge in value will arrive before long.

According to Cointelegraph on Feb. 14 (local time), Bitcoin entrepreneur Anthony Pompliano said in an interview with Fox Business that cooling inflation data is forcing investors to reconsider why they should continue holding assets. He noted that the biggest test facing market participants is whether they can maintain conviction in Bitcoin’s value proposition—its supply cap of 21 million coins—even when high inflation is not strongly felt in everyday life.

Data from the U.S. Bureau of Labor Statistics showed that the Consumer Price Index (CPI) for January fell from 2.7% the previous month to 2.4%, signaling clear stabilization. For investors who had sought long-term safe havens to protect purchasing power when central banks expanded the money supply and eroded currency value, the rationale for buying has temporarily weakened. In this regard, Moody’s chief economist Mark Zandi commented that current inflation figures may look better on paper than they do in reality.

This macro environment is casting a dark cloud over the cryptocurrency market. The Crypto Fear & Greed Index, which measures overall market sentiment, recorded a score of 9 in its Saturday update, remaining in the “Extreme Fear” zone and plunging to its lowest level since June 2022. According to CoinMarketCap data, Bitcoin has fallen 28.62% over the past 30 days and is currently trading at around $68,850.

However, Pompliano believes that these macroeconomic conditions will only cause short-term volatility before Bitcoin gets back on track. He argued that if deflationary pressures intensify in the short term, people will demand interest rate cuts and increased money issuance, leading to what he described as a “monetary slingshot” effect—where deflation masks the impact at the moment the U.S. dollar is devalued.

As a result, the Federal Reserve may have no choice but to continue expanding the money supply to address price pressures, and as the dollar faces further depreciation, Bitcoin could become a scarcer and more valuable asset than ever. Meanwhile, TradingView data show that the U.S. Dollar Index, which tracks the dollar against major currencies, has fallen 2.32% over the past 30 days to 96.88.

Disclaimer: This article is for investment reference only, and no responsibility is assumed for any investment losses incurred based on it. The content should be interpreted for informational purposes only.