Bitcoin Surges Past $60,000 Before Federal Reserve Rate Announcement
Bitcoin surged past the $60,000 mark on Tuesday amid anticipation surrounding the Federal Reserve’s impending decisions on interest rates. The flagship cryptocurrency’s value was up by 4.3% to $60,394.41, as reported by Coin Metrics, with a peak reaching $61,335.83. The momentum was initially sparked on Monday evening following the announcement of former President Donald Trump’s latest crypto initiative, World Financial Liberty Coin.
As the Federal Reserve commenced its two-day policy meeting, Bitcoin crossed the $60,000 threshold on Tuesday morning. Speculation is rife that the central bank will implement its first interest rate reduction in four years, a move that could potentially bolster risk assets like bitcoin.
According to Philipp Pieper, the co-founder of Swarm Markets, Bitcoin is expected to experience some volatility in response to the news of a Fed rate cut, but the broader implications of relaxed monetary policies could usher in a new bullish phase for Bitcoin, Ether, and the overall market. Historically, Bitcoin has exhibited correlations with major tech indices such as the Nasdaq and typically aligns with monetary conditions as investors seek higher returns in low-rate environments.
There is a split in the market regarding whether the Fed will opt for a 25 or 50 basis point rate cut. Presently, traders are factoring in a 63% likelihood of a 50 basis point rate reduction by the central bank, as indicated by CME Group’s FedWatch Tool. Each basis point represents a 0.01% change.
Throughout this year, Bitcoin has oscillated within a range of $55,000 to $70,000. Market participants have been eyeing developments such as potential Fed rate adjustments, the expansion of bitcoin ETFs, and the aftermath of the U.S. presidential election as pivotal events that could disrupt the status quo in the crypto market.
