On Wednesday morning, Bitcoin set a new all-time high after the U.S. Department of Labor released data showing a sharp rise in the consumer price index (CPI).
Amid growing inflation, investors are turning to Bitcoin as a possible store of value and hedge against economic crisis.
The CPI, which tracks the pricing of goods and services ranging from gasoline to rent, climbed to 6.2%, raising fears about mounting inflation. As for the stocks market, it began Wednesday's trading session in the red zone, with the benchmark S&P 500 trading down 0.29%.
Speaking of Bitcoin’s utility as a hedge against inflation, billionaire Paul Tudor Jones believes that the flagship cryptocurrency is a superior inflation hedge to gold.
Clearly, there’s a place for crypto. Clearly, it’s winning the race against gold at the moment.
JPMorgan released a similar note last month suggesting that institutional investors view Bitcoin as a "better inflation hedge than gold." The note said:
The reemergence of inflation concerns among investors has renewed interest in the usage of Bitcoin as an inflation hedge.
Nevertheless, this morning's price action only shows the degree to which traditional market forces affect cryptocurrencies.
According to a trading executive, "more and more of the traditional econ numbers [are going to] affect Bitcoin markets [in a] very short time frame with all these quant firms plugged in now."