Major cryptocurrencies were on the rise Wednesday afternoon, with global market capitalization increasing 2.5% to $880 million as of 7:38 pm EST.
See also: The best cryptocurrencies for 2030
Why it matters: Bitcoin and Ethereum rallied along with stocks on Wednesday as investors awaited the US Labor Department's Consumer Price Index (CPI) figure, due out early Thursday.
Economists expect the CPI to reach 6.5% in December, down from 7.1% in November.
The S&P 500 and Nasdaq closed up 1.3% and 1.8%, respectively, on Wednesday. At the time of writing, US stock futures are murky.
“Right now, there may be a calm before the inflationary storm as we don't see much of a position ahead of this CPI report. Some traders are confident that we have a soft landing or a less severe recession ahead," said Edward Moya, Chief Market Analyst at OANDA.
"Across the board price cuts will not go well with the December inflation report as last month's headline prices may rise," Moya said.
Analysts note that institutional investors remain cautious and therefore cryptocurrencies are "slightly weaker".
"If risk appetite remains intact after the inflation report, Bitcoin may return to $18,500. If fundamentals are problematic, Bitcoin may hit December lows," Moya said in a note seen by Benzinga.
Michael van de Poppe said Bitcoin was at $17,300. "We can continue the rally and then according to the CPI. Given the current outlook, we are probably correcting the CPI temporarily before moving forward," the crypto trader said. If the CPI breaks, Bitcoin could reach $18,500 tomorrow, he said.
Separately, Van de Poppe expressed hope for Bitcoin this year. He said it's "very likely" that Apex will hit $30,000-$40,000 in the next 6 months, but most people "aren't ready yet."
Santiment said Tether (USDT) "continues to grow in the next [bull bull] on shark and whale shipments." The market research platform says there are now 21,459 addresses in USDT with $100,000 or more, which is 1% below the new all-time high.
According to Ki Young Ju , CEO of CryptoQuant , Grayscale-owned Digital Currency Group (DCG) was moving 21,000 BTC worth nearly $379.07 million at the time of writing. Funds are transferred, realizing 60% of the chain's losses.
"Maybe switching to a new cold wallet for security reasons. Over 1,000 BTC going into Coinbase exchange, presumably due to management fees," Ki said on Twitter.
Notably, Gemini Exchange founder Cameron Winklevoss on Tuesday called for the firing of DCG CEO Barry Silbert , who led the alleged fraud.
Read: Almost half of all bitcoins haven't moved an inch in 2 years - Ark Invest has the strongest support for this level.