Bitcoin steadies near $64,000 ahead of U.S. inflation data

Bitcoin held around $64,000 on Tuesday as investors paused ahead of the July U.S. inflation report, a key driver for Federal Reserve policy expectations.

The cryptocurrency last traded at $63,950, little changed from Monday’s close, reflecting a cautious stance in thin summer trading. Oil prices hovered near $90 per barrel, contributing to a subdued risk appetite across broader markets.

A fresh exploit targeting Harmony Protocol disrupted sentiment in the altcoin space. The incident, disclosed late Monday, saw an attacker drain approximately $116 million in assets from the cross-chain bridge, according to blockchain security firm PeckShield. Harmony confirmed the breach and said it was coordinating with law enforcement and security experts to trace the stolen funds.

The exploit added to recent volatility in smaller tokens, which have underperformed bitcoin and ether in recent sessions. Analysts noted that while the incident was significant, its direct impact on major cryptocurrencies appeared limited, with bitcoin and ether maintaining their dominance in the market.

Traders are focused on the U.S. Consumer Price Index (CPI) for July, due at 8:30 a.m. ET Wednesday. Economists polled by Reuters expect a 0.2% monthly increase in headline CPI, with core inflation—excluding food and energy—forecast to rise 0.2% as well. The data will be critical in shaping expectations for the Fed’s next policy move at its September meeting.

Futures tied to the Fed’s benchmark rate currently imply a 65% chance of a 25-basis-point rate cut in September, according to CME Group’s FedWatch tool. Any surprise in the inflation reading could shift those odds materially.

In broader markets, equities were mixed, with European stocks edging lower and U.S. futures pointing to a slightly higher open. The dollar index held steady near recent peaks, while Treasury yields remained range-bound ahead of the data.

The Harmony incident underscores ongoing security risks in decentralized finance (DeFi), particularly for cross-chain protocols that have become frequent targets for hackers. The platform, which facilitates asset transfers between blockchains like Ethereum and Binance Smart Chain, has faced multiple exploits in recent years, including a $100 million breach in 2022.