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By Omkar Godbole|Edited by Parikshit Mishra
Updated Aug 12, 2025, 5:51 a.m. Published Aug 12, 2025, 5:49 a.m.
- Bitcoin traders are seeking protection against potential losses ahead of U.S. inflation data, which may show the impact of trade tariffs on consumer prices.
- The consumer price index is expected to rise to 2.8% year-on-year in July, with a monthly increase of 0.2%.
- A higher-than-expected CPI could dampen Fed rate cut bets and weigh on risk assets, including bitcoin.
Bitcoin
traders are seeking downside protection ahead of the U.S. inflation data, which is expected to show President Donald Trump’s trade tariffs are starting to affect consumer prices.
The report, due at 12:30 UTC, is expected to show that the headline consumer price index (CPI) increased 2.8% year-on-year in July, up from a 2.7% rise in June, according to Bloomberg data.
STORY CONTINUES BELOW
On a monthly basis, prices are forecast to increase 0.2%, a slight decline from July’s 0.3%. The core CPI, which excludes the volatile food and energy component, is likely to have risen 0.3% in July following a 0.2% rise in June.
According to analysts, a hotter-than-expected CPI could dampen Fed rate cuts, potentially weighing on risk assets, including BTC.
‘The market’s immediate focus is on Tuesday’s U.S. CPI print, with the market expecting a modest uptick to 2.8% YoY. A softer reading would likely cement a September rate cut by the Federal Reserve, a positive for risk assets. Conversely, a hotter print could stall the rally, triggering tactical profit-taking across risk assets,” Timothy Misir, head of research at BRN, told CoinDesk in an email.
Some traders are already positioning for a hotter print and potential losses in BTC. According to Singapore-based QCP Capital, the precautionary flow is evident from the increase in demand for short-dated put options. A put option protects the buyer from price losses in the underlying asset.
“In anticipation, some traders are hedging event risk, with front-end $115,000–$118,000 BTC puts seeing increased demand to protect against a downside surprise,” QCP Capital’s market insights team said Monday. “This defensive positioning sits alongside short-call covering from topside buyers.”
The covering of the short call positions indicates that traders also remain wary of topside risk. BTC changed hands at $118,525 at press time.
Read more: Bitcoin Traders Eye $135K, Ether $4.8K in Crosshairs as CPI Data Looms
Omkar Godbole is a Co-Managing Editor and analyst on CoinDesk’s Markets team. He has been covering crypto options and futures, as well as macro and cross-asset activity, since 2019, leveraging his prior experience in directional and non-directional derivative strategies at brokerage firms. His extensive background also encompasses the FX markets, having served as a fundamental analyst at currency and commodities desks for Mumbai-based brokerages and FXStreet. Omkar holds small amounts of bitcoin, ether, BitTorrent, tron and dot.
Omkar holds a Master’s degree in Finance and a Chartered Market Technician (CMT) designation.
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By Shaurya Malwa|Edited by Parikshit Mishra
44 minutes ago
This week’s rally has flipped the usual dynamic so far, with altcoin strength dragging BTC higher instead of the other way around.
What to know:
- Bitcoin holds above $119,000 following a 2.2% daily rise, while ether approaches its $4,800 record after a 17.2% weekly surge.
- Major altcoins, including XRP and Solana, see gains, contributing to a global cryptocurrency market cap of $4 trillion.
- U.S. inflation data and ETF inflows are influencing crypto market dynamics, with traders hedging against CPI event risks.
