Bitcoin dropped 5% last month after reaching an all-time high of around $68,950 in early November.
Bitcoin's all-time high was reached shortly after the October Consumer Price Index (CPI) report revealed higher-than-expected inflation in the United States. According to the report, the CPI rose 6.2 percent in October compared to the previous year, resulting in the fastest rate in three decades.
According to IntoTheBlock's Juan Pellicer, the shakeout appeared to coincide with a decline in US stock markets as analysts parsed the CPI report.
According to Pellicer, “The S&P 500 and Nasdaq reacted badly to the announcement (...) this then influenced the crypto market.”
Lennard Neo of Stack Funds wrote in a report that the delayed market reaction in stocks and bitcoin could have resulted from an end-of-day assessment that faster inflation would prompt the Federal Reserve to tighten monetary policy sooner.
Ether also took an unexpected tumble after a record high of $4,851, seeing a 2% drop the same day as its peak.
However, despite all this doom and gloom, Daniel Kukan, senior crypto trader at Crypto Finance AG, stated that ETH was set to soon outperform BTC in terms of growth.