What happened

Shares of most cryptocurrencies and crypto stocks moved higher today after new data showed that inflation might be starting to peak.

Over the last 24 hours, the price of the world's largest cryptocurrency, Bitcoin (BTC 3.23%), traded 4.7% higher as of 10:10 a.m. ET today, while the price of the world's second-largest cryptocurrency, Ethereum (ETH 6.69%), traded 8.7% higher. On the day, shares of the Bitcoin miner CleanSpark (CLSK -7.78%) traded almost 15% higher.

So what

All week investors have been waiting for the latest reading of the consumer price index (CPI), which tracks the prices of a range of daily consumer goods and services. This morning, the data showed the index grew 8.5% in July on a year-over-year basis. What's more, the CPI remained unchanged from June on a seasonally adjusted basis. Both of those numbers came in below expectations and suggest that inflation could have peaked last month.

Green squiggly line moving upward.

Image source: Getty Images.

The decline was led by a 4.6% drop in energy prices from June. Within energy, fuel prices fell 11% and all gasoline prices dropped 7.7%. Transportation services also dropped half a percent from June and the shelter index rose half a percent but at a smaller pace of growth than over the last two months. Furthermore, energy services only grew 0.1% from June after a 3.5% rise in June. Within this category, utility gas service fell by 3.6% in July.

The better-than-expected inflation report could mean that the Federal Reserve's hawkish policy so far this year is working to tame inflation, which could potentially let the Fed ease up on interest rate hikes as the year progresses. Rate hikes have crushed crypto prices this year with Bitcoin and Ethereum down roughly 50% and 51.4%, respectively. Rising rates make safer assets yield more and put pressure on growth and risk assets. 

In other news, CleanSpark reported second-quarter earnings last night that came in worse than expected, but CEO Zach Bradford said in a statement the company "continued to grow by mining a record number of bitcoin and substantially increasing our hashrate," or its computing power.

Furthermore, CleanSpark announced that it plans to sell the assets of its more traditional energy business and purchase another facility for Bitcoin mining.

Now what

Today is a good day for the market and crypto because there is finally some good news about inflation, which means the Fed may be able to start to slow the pace of rate hikes, which have been incredibly aggressive this year.

I continue to like Bitcoin and Ethereum on a long-term basis and also believe that CleanSpark is headed in the right direction after its latest update.