Crypto Market Sinks on Soft PPI, Middle East Tensions

The cryptocurrency market recorded mild losses on Thursday following the release of the latest Producer Price Index (PPI) report, which signaled cooling wholesale inflation in the United States.

Bitcoin (BTC) dipped 2.4% to $107,100, while Ethereum (ETH) dropped 5% to $2,724. Meanwhile, XRP and Solana (SOL) plunged by 4% and 6%, respectively.

The total cryptocurrency market capitalization plummeted by 5% in the past 24 hours to $3.49 trillion. Leveraged liquidations totaled $326 million in this time period, according to CoinGlass. ETH accounted for around $90 million, while BTC liquidations stood at around $72 million.

U.S. spot BTC exchange-traded funds (ETFs) recorded $165 million in inflows on Wednesday. Meanwhile, Spot ETH ETFs brought in around $240 million in inflows, according to SoSoValue data.

PPI Report

Experts attribute today’s market losses to the latest macroeconomic data and rising geopolitical unrest in the Middle East.

The Bureau of Labor Statistics reported that PPI rose just 0.1% in May, below the 0.3% forecast.

Year-over-year, PPI climbed 2.6%, aligned with expectations and slightly above April’s 2.5%. Core PPI rose 0.1% on the month – also below the 0.3% forecast – while the annual rate fell to 3.0% from a revised 3.2%.

The report followed Wednesday’s cooler-than-expected consumer inflation data, which temporarily lifted market sentiment.

“Crypto markets are trading lower today amid a broader risk-off tone across global assets,” said Ryan Grace, head of digital assets at TastyTrade, a retail brokerage.

Grace added that the sell-off reflects a shift in sentiment toward caution, with heightened geopolitical tensions in the Middle East only adding to uncertainty. “Bitcoin and Ethereum are down over 2.5%, mirroring declines in tech and growth stocks,” he said.

Tobin Kuo, CEO of Seraph, echoed Grace’s sentiment, stating: “The lower than expected PPI points to easing inflation pressures, which slightly reduces the odds of further Fed tightening but doesn’t really alter expectations around the timing of rate cuts.”

“In crypto, we’re seeing the usual high beta response. Bitcoin pulled back, but the real story is under the surface—leverage is resetting, open interest is dropping, and strong hands are waiting,” said Ben Kurland, CEO at crypto research and charting platform DYOR.

“This isn’t a risk-off collapse. It’s a healthy reminder that macro still matters, and the path to $120K isn’t going to be a straight line,” he concluded.