Bitcoin Tops $126K Nominally but Inflation-Adjusted Peak Stays Below $100K
Bitcoin reached a nominal intraday high above $126,000 in October 2025, but Galaxy Digital research head Alex Thorn calculates the peak falls to about $99,848 when adjusted to 2020 US dollars using CPI — beneath the $100,000 real level. The analysis uses cumulative CPI inflation as a deflator and highlights that part of Bitcoin’s recent nominal gains reflect dollar depreciation rather than pure real appreciation. US CPI remained above the Fed’s 2% target (11-month annual rate ~2.7% in November) and the dollar lost purchasing power (~20% since 2020), with the US Dollar Index (DXY) down roughly 11% in 2025. These forces have pushed flows into scarce assets — Galaxy frames it as a “currency depreciation trade” that benefits Bitcoin and gold. Market participants noted a ~30% retracement after the October peak, with year-end trading in the $87k–$93k band in one earlier note; VanEck described recent pullbacks as healthy deleveraging and miner stress rather than structural crashes. Institutional accumulation—including corporate balance-sheet purchases—continued even as some exchange-traded product flows exited. Draft regulatory proposals in the US and Europe are adding short-term volatility; some analysts warn prices could revisit roughly $65,000 on regulatory or deleveraging shocks. Key datapoints: nominal peak > $126,000; inflation-adjusted peak ≈ $99,848; US CPI ~2.7% (Nov annualized); DXY ~97.8 (≈11% drop in 2025). For traders: prioritize monitoring CPI prints, Fed guidance, DXY moves and real (inflation-adjusted) price metrics alongside nominal charts; weigh position sizing against potential regulatory-driven volatility and periodic deleveraging.
Neutral
The net effect of the reporting is neutral for Bitcoin price direction. Bullish signals include continued institutional accumulation and strong flows into scarce assets driven by dollar depreciation and above-target CPI — factors that support a long-term store-of-value thesis. Conversely, the inflation-adjusted peak below $100K weakens the narrative of unambiguous real gains and highlights that part of the rally was currency-driven, not fundamental appreciation. Short-term risks are elevated by regulatory uncertainty and deleveraging/miner stress that have produced sizable retracements (roughly 30% from the nominal peak) and could push prices toward the cited $65,000 scenario during shocks. For traders this implies mixed implications: momentum and institutional demand can sustain rallies, but volatility and periodic downside are more likely than a smooth, one-way uptrend. Practical trading takeaway: monitor CPI prints, Fed commentary, DXY moves, ETF/flow data and regulatory developments; use tighter risk management and consider inflation-adjusted levels when sizing positions.