Falling inflation triggers a rebound in risk appetite, with Bitcoin breaking through $95,000 to lead the crypto market

The crypto market has experienced a clear rebound driven by macroeconomic improvements. According to the latest news, US inflation data came in below expectations, further strengthening market expectations for the Federal Reserve to continue cutting interest rates. Bond yields have eased, and liquidity conditions have improved accordingly. Against this backdrop, Bitcoin surged past the $95,000 mark on Wednesday, hitting a new high in a week and approaching the upper boundary of the price range established in January. Market risk appetite has also rebounded, with mainstream crypto assets such as Ethereum, Solana, and Cardano generally rising.

Multi-asset rally, market sentiment shifts

Price and gain data

This rally is not driven by a single asset but reflects an overall warming trend. According to quick news data:

• Bitcoin has increased by over 4% in the past 24 hours, re-attracting capital flow into this scarce non-sovereign asset
• Ethereum performed relatively stronger, rising over 7% in a single day, with prices returning to around $3,330
• Tokens like SOL, ADA, XRP, and BNB generally gained between 8% and 9%

In terms of market share, Bitcoin still holds an absolute dominance. Data shows BTC’s market cap reached $1.90 trillion, accounting for 58.43% of the entire crypto market, with a 24-hour trading volume exceeding $6 billion. This market structure indicates that Bitcoin’s price performance has the greatest influence on overall market sentiment.

Macroeconomic drivers

The direct catalyst for this rally is US inflation data. Inflation below expectations further reinforced investors’ expectations that the Federal Reserve will continue its rate cuts into 2026. This shift in outlook triggered a chain reaction:

• Bond yields eased, increasing the attractiveness of high-yield bonds and other risk assets
• Overall liquidity environment improved, with funds flowing from low-risk to high-risk assets
• Assets considered less affected by central bank credit risk, such as Bitcoin, are being revalued as stores of value, reinforcing their market perception

Additionally, recent reports indicate that the US Department of Justice is investigating matters related to the Federal Reserve, causing a temporary weakening of the dollar. In the context of dollar depreciation, Bitcoin priced in USD becomes more attractive, further pushing up its price.

Signals from the derivatives market

Short position liquidation volume

This upward move was accompanied by large-scale short liquidations. According to Coinglass data, over the past day, crypto derivatives market liquidations exceeded $680 million, with the vast majority being short positions. This reflects significant leverage short positions in the market that were forced to close during rapid price increases.

Concerns over market volatility

As prices surged rapidly, leverage funds re-entered the market, which could further amplify short-term volatility. In this scenario, prices may fluctuate within a wider range, potentially continuing upward or experiencing a correction. Traders should pay attention to leverage levels and liquidation levels in the derivatives market.

Support from macroeconomic background

This rebound is not limited to the crypto market. Traditional financial markets are also strengthening in tandem, with Asian stock markets reaching new highs and precious metals prices remaining in high ranges. This reflects a general investor preference for assets that benefit from loose monetary policies and currency uncertainty.

For the crypto market, this macroeconomic environment provides important support for Bitcoin and mainstream tokens’ further performance into 2026. As long as inflation remains moderate and the Fed maintains a dovish policy outlook, risk assets are likely to continue attracting capital.

Summary

Positive inflation data directly improved the macro environment, boosting risk appetite and driving Bitcoin past $95,000 along with a broader crypto market rebound. This is not an isolated price fluctuation but a result of improved macro liquidity and shifting market sentiment. It is important to note that the large-scale short liquidations in the derivatives market and the reflow of leverage could amplify short-term volatility. The key going forward is to observe whether Fed policy expectations can be maintained and whether inflation data continues to decline, as these will directly influence the sustained performance of crypto assets.