- Bitcoin surged to an intraday high of $63,227 following the U.S. Federal Reserve’s decision to cut the benchmark interest rate by 50 basis points, fueling a broader market rally.
- This rate cut, the first since March 2020, spurred significant gains across the cryptocurrency market, with Bitcoin’s market cap reaching $1.24 trillion.
Bitcoin reached an intraday peak of $63,227 on Thursday, following the U.S. Federal Reserve’s decision to lower the benchmark interest rate by 50 basis points the previous day. This decision ignited a notable rally across the entire cryptocurrency market, driving a substantial increase in trading volume and market capitalization.
Crypto Market Surges 5%, Stocks Rise, Gold and Silver Jump Following Fed Decision
On September 19, the total value of the crypto market surged to $2.17 trillion, reflecting a 5.1% rise from the previous day. Bitcoin’s price soared from a low of $59,212 to a peak of $63,227, settling at $63,102 as of 9:17 a.m. on Thursday. Over the past 24 hours, Bitcoin has gained more than 5%, and its price has increased by 8.3% over the last week. Currently, Bitcoin’s market cap stands at $1.24 trillion, representing 57% of the entire crypto economy.
Market Data and Trends
Data from cryptoquant.com indicates a recent premium on U.S. exchange Coinbase, while the premium on South Korean platforms like Upbit and Bithumb has eased to around 1%. With Bitcoin’s recent climb, a total of $201 million in derivatives positions have been liquidated, including $146.71 million in short positions. BTC short positions alone accounted for $69.47 million in liquidations.
Federal Reserve’s Impact
The market’s upward trend is largely attributed to the U.S. Federal Reserve slashing the federal funds rate by 50 basis points on Wednesday. This marked the first rate cut since March 2020 and the larger-than-expected reduction has fueled speculation that an easing cycle is underway, potentially boosting economic growth. In contrast, the Bank of England kept its interest rate steady at 5%, as anticipated.
Broader Economic Effects
Bitcoin’s latest climb underscores how changes in the broader economy, such as interest rate cuts, can send ripples through various markets, triggering both price hikes and liquidations. On Thursday, U.S. stock futures edged up as traders processed the Federal Reserve’s announcement. Meanwhile, gold gained close to a percentage point, and silver made an even bigger leap, soaring over 3% by Thursday morning (ET). By 9:50 a.m. ET, Bitcoin was trading just under the $63,000 range.
The recent rate cut by the Federal Reserve has significantly impacted the cryptocurrency market, propelling Bitcoin to new heights and sparking a broader market rally. As economic policies continue to evolve, the interconnections between traditional financial systems and digital assets become increasingly evident, highlighting the dynamic nature of global markets.
