Bitcoin
Bitcoin rises after Fed meeting, recovering $65,000
Bitcoin rose on Wednesday, reversing early losses, as investors paused the recent pullback and pondered the Federal Reserve’s latest policy decision.
The price of the top cryptocurrency last rose 1.7% to $65,773.23, according to Coin Metrics. Earlier in the day, it fell to $60,793.60.
Cryptocurrencies strengthened at the end of the Federal Reserve’s two-day monetary policy meeting, where the central bank kept rates stable, as expected, and said it will still see several rate cuts this year. Like technology stocks, bitcoin sometimes benefits from low interest rates and greater market liquidity, which can lead to better sentiment and greater investment in growth assets.
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Bitcoin rises after two days of losses
“There has been an inverse relationship between fees and the price of bitcoin,” said Oppenheimer CEO Owen Lau. “When the Fed raised interest rates in 2022, it removed liquidity from the market, which impacted bitcoin and technology stocks. When the Fed cuts rates, it provides liquidity to the market, which should benefit risky assets like bitcoin. a little bit of everything – sometimes it trades like a high-beta tech stock.”
Bitcoin fell 10% last week after reaching an all-time high of $73,797.68 last Thursday. It is still up 53% for the year.
Ether last rose 1.2% to $3,379.43 on Wednesday after surpassing $4,000 last week. Polygon’s matic token gained 1.5%, Solana it was flat and dogecoin jumped 7%.
Crypto-linked stocks performed better throughout the day. Coin base rose 11%. Microstrategy added 9%, after falling about 20% earlier this week. In the mining sector, Iris Energy It is CleanSpark rose 26% and 22%, respectively. Digital Marathon advanced 16% and Riot Platformswhich JPMorgan upgraded on Wednesday from neutral to overweight, is up 11%.
O Dow Jones Industrial Average, S&P 500 It is Nasdaq Composite everything closed at records after the Fed meeting ends.
Bitcoin’s recent weakness began when traders began taking profits after it soared about 70% from the start of the year to its peak last Wednesday. Data from CryptoQuant shows a huge increase in short-term holders selling their bitcoins for a profit on March 12. This profit-taking led to an increase in long liquidations of leveraged bitcoin positions that continued until earlier this week, according to CoinGlass.
“We have seen 20% to 30% pullbacks in previous bitcoin bull markets as a normal occurrence when things start to heat up. And we’ve definitely had a lot of signs over the last week that things have heated up quite a bit,” Vijay Ayyar, vice president of international markets and growth at cryptocurrency exchange CoinDCX, told CNBC.
If bitcoin falls below the $60,000 threshold, the cryptocurrency could weaken further to test the $50,000 to $52,000 level, Ayyar added, “which would be our line in the sand for this bull market to sustain.” . [itself] from now on.”
—CNBC’s Ryan Browne contributed to this report.