In brief
- Bitcoin, Ethereum, Solana, and BNB all fell on the day following the latest PPI reading.
- On Myriad, the “Will Crypto bloom this Spring?” market moved sharply toward “No” in the same window.
- Analysts expect that elevated energy costs could result in higher interest rates, dampening crypto’s outlook.
Prediction market users turned sharply negative on the prospects of a “crypto spring” as prices tumbled following hotter-than-expected inflation data.
On Myriad, a prediction market owned by Decrypt’s parent company Dastan, users now put the chance of a “crypto spring” at under 50%, down from over 62% earlier today.
Under Myriad’s rules, the market resolves “Yes” only if at least four of five targets are hit during the observation period ending May 31: BTC at $80,500, ETH at $2,400, SOL at $100, BNB at $750, and HYPE at $35. With HYPE already marked as hit, traders are effectively pricing whether at least three of the remaining four majors can still clear their thresholds.
The market shift came as leading cryptocurrencies slipped on the day, with Bitcoin trading at $71,610, down 3.8% on the day according to CoinGecko data. Ethereum, Solana and BNB slipped by 5.5%, 4.8% and 3.2% respectively.
Crypto prices dropped following the Bureau of Labor Statistics’ publication of the Producer Price Index (PPI), which tracks chances in wholesale prices. Year-on-year, the PPI rose 3.4%, higher than the 2.9% annual increase anticipated by economists.
Speaking to Decrypt earlier today, GSR research analyst Carlos Guzman noted that the rise in prices would boost inflation concerns. The central bank could be forced to keep interest rates higher if elevated energy costs persist, he said, noting that it would be “bad for crypto” given that investors tend to favor risk assets when interest rates drop.
Predictors on Myriad consider the prospect of sweeping Fed rate cuts unlikely, placing just a 11% chance on a rate cut of more than 25bps before July.
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