Bitcoin Slips on Inflation Data; CoinShares Says 'Difficult' Doesn't Mean Bearish

The price of bitcoin fell this week after the release of elevated inflation figures.

However, the near-term outlook for the largest cryptocurrency is challenging, but it is not "fundamentally bearish," according to James Butterfill, head of research at CoinShares, a European asset manager.

In a Friday report, Butterfill stated that bitcoin's current difficulty originates from a macroeconomic backdrop stuck in an uncomfortable position: inflation remains too high for the Federal Reserve to loosen policy, while the economy is robust enough to avoid a shift in approach.

"Bitcoin and the broader digital asset market have moved lower on the resulting hawkish repricing, a reminder of how sensitive Bitcoin remains to monetary policy over short horizons," he said.

The value of bitcoin was recently at $81,473, a decline of 2% over the past week.

On Wednesday, the digital currency fell after figures indicated that U.S. consumer prices climbed more than anticipated in September.

The following day, the Bureau of Labor Statistics of the U.S. Labor Department reported that producer prices in the U.S. increased in September at the quickest rate in over four years.

This has put pressure on bitcoin's price since elevated inflation suggests the Fed could raise interest rates. Tighter borrowing conditions can limit the liquidity that the cryptocurrency requires to rise.

The central bank increased rates in September and is scheduled to convene later this month.

Butterfill also urged patience, advising investors to focus on a long-term perspective rather than responding to any single week's data.

"For investors, that argues for reading the coming weeks as a data-driven range rather than a trend, and for sizing digital asset exposure against a strategic allocation rather than against this week's print," he wrote.

The first half of 2026 saw bitcoin in a bear market, but it experienced its strongest quarter in years following rallies in August and September. According to analysts, the cryptocurrency has now re-entered a bull market after surpassing its 365-day moving average.