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This letter was written when the latest data on US inflation was released. From December 2020 to December 2021, it announced a 7% rate hike, the highest rate since 1982. The last time this percentage was high, it was 11.5%. Is the astonishing rate hike that put massive downward pressure on equities and other risky assets a fear for the stock market? Can Bitcoin be used as a store of value in an inflationary environment?

Of course no. The market is reacting the same way it has been in recent years. US stocks rose while inflation was in line with analysts' expectations. After testing key support at $40,000, Bitcoin remains a risky asset to extend the recovery that started 48 hours ago. This finally confirmed one thing. The US bull market that began 13 years ago is still going strong. It takes a lot, if not much, to stop a sport that has received so much attention. We can convince ourselves that Bitcoin's response this morning was a hedge against inflation.

Similarly, a new study claims that the association between Bitcoin and the S&P 500 and the Nasdaq, the two major US market indices, has reached its highest level in 18 months. Historically, Bitcoin has had limited relevance to existing asset classes, but this is changing as institutional investors increasingly dominate the market. In particular, since September, the correlation with gold, the ultimate safe-haven asset, has maintained a negative (-) relationship.

Cryptocurrency regulation could be one of the most influential variables in 2022. In addition, the distribution of proceeds from Mt.liquidation Gox has been announced, and possible geopolitical tensions between Russia and the United States. Ukraine could have a direct impact on energy prices. But for the first factor, things seem to be moving quickly. According to Federal Reserve Chairman Jerome Powell, the highly anticipated Federal Reserve cryptocurrency study is "ready for publication" and will be published "in the coming weeks." The report could focus on CBDCs or central bank digital currencies, which Powell said the Fed has been working on since China launched its own digital currency. Secretary Powell also said the report would solicit public comment. At this time, it is unclear whether the report will make specific recommendations.

The nature of the report can have a significant impact on the market. After China banned bitcoin mining, the US dominated the market. Will authorities embrace innovation and spur the growth of digital assets, or will they take a protectionist stance to maintain the value of the dollar at all costs? In the first case, with the expected launch of a Bitcoin-only ETF, all the elements for a new bull market may already be in place.

U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler had the opportunity to speak on the nature of cryptocurrencies this week. The SEC has previously said that Bitcoin is not secure, but has taken a stand against other cryptocurrencies such as Ripple's XRP. But when asked if ether is a security, Gensler dismissed that idea. "We will not engage in these types of public forums to talk about projects, possible situations or to provide over-the-air legal advice in that way," he added. The cash and what the public expects is another matter to monetize the efforts of this promoter, this supporter, and this organization.”