Ooops! $100 Billion Gone… | Web3 Daily

TL;DR

• ~$100B was wiped from the crypto market, before (mostly) being regained, after Feb’s CPI print came in at 3.2% instead of 3.1% (seriously, that’s all it took).

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Welcome to Web3 Daily, where we stare at crypto charts all day, so you don’t have to!

That’s the excuse we make to ourselves at least.

(According to a certain therapist, it could actually be considered “obsessive behavior” which is “putting an immense weight on our relationships.”)

…but what does Dr. Stevens know — she doesn’t even own crypto.

Anyways…

While watching the charts yesterday, we witnessed a quick/violent dip, where ~$100B was wiped from the crypto market in ~1hr, after the release of Feb’s Consumer Price Index.

(Aka ‘CPI.’ Aka “how much more expensive has everything become in the past 12 months?”).

Here’s a rapid fire breakdown of how it all went down & why:

• Everyone expected CPI to have increased 3.1% since this time last year, but it came in at 3.2%

• This stoked fears that interest rates would be kept higher, for longer — putting pressure on the economy.

• The longer rates stay high, the less chance we’ll have of making a ‘soft’ landing (aka lowering inflation without going into a recession).

All of that played out over 1-2 hours, wiping ~$100B from the crypto market, before (mostly) regaining it all…

All from a .1% difference in expected CPI.

Economics, amiright?