Binance CEO thinks US inflation should be 500%. Here’s why and CZ’s explanations…
Binance CEO criticizes accuracy of inflation data
While the entire market is panicking with the latest US inflation data, Binance CEO Changpeng “CZ” Zhao says it is still “magically low”. The consumer price index rose 9.1% in June compared to a year ago, more than analysts’ forecast. Bitcoin briefly dropped below $19,000 after the U.S. Bureau of Labor Statistics reported inflation data. The Nasdaq, Dow Jones and S&P 500 also fell amid high inflation figures.
Binance CEO’s comment on inflation measurement
Commenting on the inflation data, Binance CEO says that 80% of the dollar in circulation has been printed in the last 2 years.
CZ questioned how the Department of Labor showed such a low figure. He also claimed that an inflation of 9.1% was “magically low”. He says we should see 500% inflation given 80% newly minted dollars = 5x the original supply. According to CZ, inflation is calculated only on the basis of the increase in money supply over a given period of time.
Crypto community reacts to US inflation
Market players’ opinion is that the June CPI data will be at 8.8%, which is 0.3% lower than the US Bureau of Labor Statistics reported. The high inflation rate got a similar reaction from all the major crypto phenomena.
A number of major crypto influencers, including Michael Saylor, Cameron and Tyler Winklevoss, have stated that high inflation is pushing the case for Bitcoin and crypto adoption. However, the crypto market has recorded around 70% value since the beginning of 2022. Thus, it has largely failed to maintain its value through rising inflation this year.
The higher inflation reading now points to sharper rate hikes by the Federal Reserve. Therefore, it is interpreted as a strictly negative move for the cryptocurrency market. So far, Bitcoin has also taken the crypto market down by reacting badly to increases in lending rates.
Cryptocurrencies fell hard ahead of US inflation data
Ethereum (ETH) dropped as low as $1,019 during the CPI announcement. The leading altcoin was trading around $1,089 before the data was released. According to the data, meanwhile, the BTC price also dropped below the $19,000 level. However, 24-hour trading volume increased by over 14% to $31.8 billion. Also, Bitcoin price quickly recovered after the initial drop. Currently, it is trading at $19,844.64. As we quoted as Kriptokoin.com, the last 24 hours of the top 50 cryptocurrencies were in the green.
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