Analysis: Rising inflation suppresses interest rate cut expectations, leading to phased pressure on Bitcoin

According to BIT analysis, if Bitcoin had kept pace with the Nasdaq's rally, its current price should be close to $140,000. Bitcoin's relative underperformance may be related to the resurgence of inflation since the third quarter of 2025. Overall, Bitcoin had largely followed Nasdaq's fluctuations, but the divergence between the two began to widen significantly starting in October 2025. At that time, the latest CPI reading had rebounded to 3.0%, 100 basis points above the Federal Reserve's target, and the interest rate market began to gradually withdraw some pricing for interest rate cuts in 2026. This is precisely the source of Bitcoin's real pressure. Bitcoin's upward momentum relies on expectations of Federal Reserve easing; once the market begins to withdraw pricing for interest rate cuts, its performance tends to come under pressure. This logic has continued to influence Bitcoin's trend since then. Stocks, on the other hand, are completely different. As long as the market views inflation as mild and temporary, a rebound in inflation is actually beneficial for stocks: even if sales do not increase significantly, it can boost corporate nominal revenue, reduce real debt burdens, and enhance the appeal of stocks as a hedge against purchasing power. The latest US inflation data seems to have caught some market participants off guard, although the institution's models had previously indicated a potential resurgence of price pressures. The key questions now are: will this repricing of inflation expectations weaken Bitcoin's continuously improving fundamentals; and in this context, how should investors adjust their positions going forward?