Monetary factors exerted the greatest pressure on alternative assets, including cryptocurrencies. September US inflation data showed a significant acceleration in price growth and signs that inflationary pressures were spreading beyond the energy sector into other areas of the economy. The Consumer Price Index (CPI) increased from 3.4% to 3.7% year-on-year, exceeding forecasts of 3.6%, while the core indicator rose from 2.4% to 2.6%, compared with expectations of 2.5%. Meanwhile, the Producer Price Index (PPI) accelerated from 5.6% to 6.3%, reaching its highest level since 2022 instead of declining to the expected 5.3%. The core measure, excluding food, energy and trade services, increased from 4.8% to 5.0%, against forecasts of 4.4%. Persistent inflation above the Federal Reserve's 2.0% target increased expectations of an October interest rate hike, supporting the US dollar. Against this backdrop, BTC briefly fell below 80000.00, but the situation stabilised following comments from members of the Federal Open Market Committee (FOMC). San Francisco Federal Reserve Bank President Mary Daly stated that further monetary tightening would likely be necessary, although there was no immediate urgency to act. Fed Vice Chair for Supervision Michelle Bowman added that policymakers still had time to assess economic conditions before making further decisions. Federal Reserve Chair Kevin Warsh, speaking today at the annual meetings of the International Monetary Fund (IMF) and World Bank, emphasised that the outcome of the upcoming policy meeting should not be prejudged. This rhetoric reduced expectations of an interest rate increase in October, while the probability of additional tightening by December remained close to 90%, according to the Chicago Mercantile Exchange (CME) FedWatch Tool. The change in monetary policy expectations contrasts with the more favourable conditions discussed in our previous Bitcoin forecast.
The cryptocurrency sector is also receiving support from a recovery in global equity markets and shares of companies involved in artificial intelligence (AI) development. Asian stock markets rebounded today following the recent technology-sector sell-off, with renewed demand for AI-related assets helping to improve investor sentiment. Nevertheless, the situation remains highly uncertain, and in the medium term, any signals of changes in US monetary conditions or further escalation of the Middle East conflict could trigger significant price volatility.
Among the latest developments in the cryptocurrency industry is the announcement of Ledger Atom, a new security-focused Android device from Ledger SAS, a manufacturer of cryptocurrency hardware wallets. The product is expected to begin shipping in 2027 and will operate in two separate modes: Standard Mode for everyday Android applications and Secure Mode for managing digital assets and approving sensitive transactions. Unlike a conventional smartphone, the device is primarily designed for security and privacy rather than traditional mobile communication. Similar blockchain-oriented mobile devices were previously introduced by Solana Mobile, including the Saga in 2023 and the Seeker in 2025. In addition, according to a study by blockchain security company Hacken, cryptocurrency businesses suffered 107 hacking incidents during the third quarter, resulting in approximately $1.18 billion in gross losses. The largest incidents included the Bitget cryptocurrency exchange hack, with losses of around $387.0 million, the Liquid Network exploit involving approximately $320.0 million, and the Tectonic lending protocol exploit, which resulted in losses of around $120.0 million.
Sentiment in the digital asset market remains moderately positive, as reflected by the Crypto Fear & Greed Index holding at 63 points in the "Greed" zone. Against this backdrop, the sector may resume its upward movement or enter a period of consolidation next week, although uncertainty surrounding US monetary policy and geopolitical developments continues to pose risks.
