Bitcoin’s resurgence over $112,000 has sparked optimism among crypto enthusiasts, while Solana’s SOL reaching a seven-month high of $222 adds fuel to the market’s buoyant mood. Despite the unsettling U.S. jobs data that initially shook confidence, economists are downplaying recession fears, suggesting that the economic landscape might not be as bleak as some predict.
Bitcoin Bounces Back
Wednesday saw Bitcoin (BTC) reclaim the $112,000 mark, a robust recovery from the previous day’s dip to $110,800. The drop was triggered by a shocking revision from the U.S. Bureau of Labor Statistics, revealing that the economy added 911,000 fewer jobs than initially reported for the 12 months through March 2025. This revelation rattled investors, who had been banking on a resilient labor market to support economic growth despite persistent inflation.
However, market analysts, including Michael Englund of Action Economics, argue that the jobs data revision is more indicative of a changing labor force trajectory rather than an immediate economic downturn. Englund notes that the U.S. is experiencing a net out-migration, a shift from the post-COVID in-migration surge that fueled labor force growth. This change, he suggests, points to slower growth in employment but not necessarily to an impending recession.
Solana and Altcoins on the Rise
While Bitcoin’s recovery has captured headlines, Solana (SOL) has quietly achieved its own milestone, hitting $222—its highest level since February 1. Altcoins like Ethereum (ETH), XRP, and Dogecoin (DOGE) have also clawed back losses from the previous day, contributing to the broader market’s positive sentiment.
The rise in altcoins coincides with stronger performances in traditional equity markets. European stocks opened higher, and the S&P 500 futures recorded a 0.3% increase, reflecting investor confidence despite the recent labor market shock.
Stagflation Fears: Overblown or Justified?
The revised jobs data and looming U.S. Consumer Price Index (CPI) report have reignited concerns about stagflation—a toxic mix of high inflation, high unemployment, and stagnant growth. Yet, not everyone is convinced that the economy is heading toward this grim scenario.
Marc Chandler of Bannockburn Global Forex dismisses stagflation fears as exaggerated. He points out that the U.S. GDP continues to exceed the Federal Reserve’s non-inflationary growth estimates, suggesting underlying economic strength. Chandler anticipates that the Federal Reserve will resume easing monetary policy, potentially cutting rates by 25 basis points next week, a move supported by a 91% likelihood according to the CME’s FedWatch tool.
Eyes on the CPI
Attention now turns to the forthcoming U.S. CPI and Producer Price Index (PPI) reports. These indicators will be crucial in shaping market expectations and the Fed’s next moves. A surprise in these reports could either bolster the current bullish momentum or trigger a market sell-off if rate cuts fall short of expectations.
Greg Magadini of Amberdata cautions that if the market is banking on a 50-basis-point rate cut, a smaller 25-basis-point reduction could lead to disappointment and volatility. The upcoming data will therefore be pivotal in either reinforcing or dampening the market’s recent optimism.
Conclusion
As Bitcoin and altcoins rally, and with European stocks showing resilience, the narrative of an impending recession is being challenged. Economists and market strategists suggest a more nuanced view, recognizing the complexities of the current economic climate. While uncertainties remain, particularly around inflation and monetary policy, the sentiment in crypto and equity markets is one of cautious optimism. As the economic data unfolds, investors will be keenly watching for signs of either validation or volatility in this ever-evolving financial landscape.
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
