Bitcoin boomed—and then tumbled. The world’s largest cryptocurrency hit another all-time high Wednesday evening, surging past $124,100, according to data from Binance. But, since notching a new record, the token has dropped 5% and now hovers below $118,000.
Ethereum, the world’s second largest cryptocurrency by market capitalization, is also hovering near all-time highs but is down 4% over the past 24 hours at about $4,500, per Binance. Still, the token’s price has soared over the past month to increase by almost 50%.
The total market capitalization of all cryptocurrencies has dropped almost 4% over the past day to around $4.07 trillion, according to CoinGecko, and the S&P 500 is slightly down Thursday since markets last closed.
Bitcoin’s Wednesday surge followed a bout of optimism about the prospect of rate cuts in September from the Federal Reserve. On Tuesday, the Bureau of Labor Statistics reported only a moderate increase in inflation in July of 2.7%. Analysts soon predicted that September rate cuts—which would likely prompt investors to take money out of U.S. Treasuries and put them into riskier bets like Bitcoin—were almost a given, according to the CME Group’s FedWatch tool.
“The near certainty of U.S. interest rate cuts lifts risk appetite and pressures the dollar,” said Axel Rudolph, senior technical analyst at IG, a UK-based financial firm.
But, on Thursday morning, the BLS reported a worrying price increase in July of 0.9% in goods made by U.S. producers. It was the biggest increase since June 2022, and the crypto market dipped along with the news.
“The recent pullback in crypto prices following a hotter-than-forecast reading on PPI seems to have shaken broader confidence in a Fed rate cut next month,” said Thomas Perfumo, global economist for Kraken, one of the largest crypto exchanges in the U.S.
Kyle Chasse, founder and chairman of the crypto venture firm MV Global, echoed Perfumo. “This spooks people,” he said of Thursday’s BLS report.
Despite the pullback, the crypto market is still near all-time highs. The total market capitalization continues to hover over $4 trillion, a mark it crossed for the first time in July amid a boom in the stock market and crypto-friendly policies from President Donald Trump.
Correction, August 14, 2025: A previous version of this article misquoted Thomas Perfumo.