Inflation adjustment reveals: Bitcoin's real record remains below $100,000

The Hidden Truth Behind the Nominal All-Time High

Bitcoin price reached over $126,000 in October 2025 nominally — a milestone that dominated headlines. But a detailed analysis by Galaxy Research revealed a less rosy reality: measured in inflation-adjusted 2020 dollars, Bitcoin’s actual peak was only $99,848. This discrepancy highlights how much inflation since 2020 has eroded the purchasing power of the US dollar.

Alex Thorn, Head of Research at Galaxy, made this insight public, emphasizing a fundamental problem for investors: without inflation adjustment, nominal price records can be misleading. The Consumer Price Index (CPI), tracked by the US Bureau of Labour Statistics, clearly shows that consumer prices have increased by about 25 percent since 2020 — in other words, a dollar today has only about 80 percent of the purchasing power it had five years ago.

Why CPI Adjustment Is Crucial

A consumer price index calculator illustrates the severity of this development. The cumulative inflation since 2020 means that goods and services that cost $100 back then now cost about $125. CPI data from November showed an annual increase of 2.7 percent — a figure that continues to erode confidence in the stability of fiat money.

This reality forced investors to realign their strategies. Those who held Bitcoin over the past five years experienced massive nominal gains, but in real terms, performance was well below expectations. With the current BTC price of $90,220, it becomes clear: even the previous record high of $126,080 looks very different when evaluated in constant 2020 dollars.

The Dollar Weakness as a Catalyst for Cryptocurrencies

The US Dollar Index (DXY) lost about eleven percent of its value in 2025, falling to 97.8 points. In September, the index even hit a three-year low of 96.3 points. This ongoing weakness has intensified since October 2022, as the dollar continues to lose ground against other global currencies.

The Federal Reserve aimed for a two percent inflation target — but the actual rate remains well above that. After peaking at over nine percent in mid-2022 following the COVID-19 pandemic, price pressures remain persistent. This macroeconomic situation fuels the so-called “purchasing power protection process,” where institutional and private investors increasingly turn to Bitcoin and other digital assets — not as speculative objects, but as hedges against money devaluation.

Market Signals and Outlook

Despite inflation-adjusted sobriety, there are signs of market stabilization. Various analysts point to healthy market correction: speculative leverage has been removed from the system, and structural liquidity is improving. While exchange-traded products experienced outflows, there are also aggressive buy signals from corporate sides and persistence among long-term Bitcoin holders.

Galaxy’s analysis emphasizes a key insight: those who see Bitcoin as an inflation hedge should not be distracted by short-term price fluctuations. The real performance in inflation-adjusted dollars reveals that Bitcoin can still fulfill its fundamental function — preserving wealth in times of money devaluation — even during nominal declines.