Bitcoin’s psychological stronghold at $80,000 has been breached. The cryptocurrency, which spent nine consecutive days above that threshold on the back of record ETF inflows, plummeted to as low as $74,190 in the wake of two compounding shocks: a hotter-than-expected inflation print and the confirmation of Kevin Warsh as the new Federal Reserve Chair. With more than $200 billion erased from Bitcoin’s market capitalization since its October peak above $120,000, the selloff has thrust monetary policy and crypto’s correlation with macro risk into sharp focus.
The timing was stark. April’s Consumer Price Index hit 3.8% year-over-year—the highest since May 2023—while core inflation climbed 2.8%. The following day’s PPI surged to 6%, pushing rate hike odds to 39% in Fed Funds futures. On the same week, the Senate confirmed Warsh in a 54-45 vote—the most divisive Fed chair confirmation in modern history—and he assumed office on May 15. Though Warsh is widely regarded as the most crypto-friendly Fed chair ever, having personally invested in dozens of digital asset ventures and calling Bitcoin “the new gold for anyone under 40,” his hawkish stance on inflation has triggered a classic risk-off response across crypto markets.
This report dissects the data behind the crash, examining price action, ETF flows, inflation metrics, Warsh’s policy outlook, and the legislative landscape (the CLARITY Act). We’ll also assess key support levels and what the June FOMC meeting could mean for Bitcoin’s near-term trajectory.
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