Altcoin recovery in full swing

Thanks to the positive sentiment that emerged yesterday after the release of the US Consumer Price Index (CPI), crypto prices have been rising throughout the day.

Thanks to the positive sentiment that emerged yesterday after the release of the US CPI, crypto prices have been climbing all day today. The CPI for July came in at 8.5%, well below the 9.1% from the month prior. For investors, that signals inflation has peaked.

A cooling of inflation would signal central banks worldwide to take a much more cautious stance on further increases in the key policy rate. Risky asset classes like tech stocks and cryptocurrencies stand to benefit the most.

These assets have been on a recovery rally over the past weeks after months of substantial price declines, and that trend has continued in recent days. It’s becoming clearer that the bottom is in. This is evident on many charts: shortly after the inflation data release at 14:30, prices for many altcoins rose sharply.

Ethereum, in particular, has drawn attention after yesterday's events. After the merge successfully completed on the last testnet “Goerli,” there is little left standing in the way of the shift to the proof-of-stake consensus mechanism. Read more about this upgrade here.

Altcoins within the top-50 by market cap showed the biggest gains. Here’s a look at coins that surged.

Aave (AAVE)

AAVE, the token of the lending platform, is also showing strength. After days hovering around $100, the token broke through that resistance and jumped 11.5% to nearly $110.

In addition to the prospect of its own stablecoin, the token is likely benefiting from the Aave community’s announcement that the protocol can run on the new Ethereum proof-of-stake chain without major concerns. This positions Aave clearly on the PoS side and rejects potential proof-of-work forks.

SOLANA (SOL)

SOL is up a little more than 10% today and now sits at $44. The altcoin is thus bouncing back somewhat from the turbulence of the past few weeks.

With up to 50,000 transactions per second, Solana is currently the fastest blockchain and is seen by many as a serious competitor to Ethereum. Outages and downtime on the blockchain continue to occur, along with a recent network exploit. Such ups and downs are also visible in the monthly price action, which has generally been range-bound.