Bitcoin
and other cryptocurrencies were little changed Monday, holding at elevated levels after a recent rally as digital assets benefited from bets that the Federal Reserve has finished raising interest rates.
The price of Bitcoin has traded just above flat over the past 24 hours at almost $35,200, below its recent peak near $36,000 but still trading around the highest levels since cryptos plunged into a brutal bear market in May 2022. The largest digital asset has surged by some 30% in a matter of weeks, snapping out of a multi-month lull of historically low volatility and trading volumes.
“Bitcoin has formed a short-term range with a slight upward bias and trades increasingly confident above $35,000,” said Alex Kuptsikevich, an analyst at broker FxPro. “Thawing investor sentiment towards cryptocurrencies brings capital back into the industry after a long ‘winter.’”
Bitcoin’s latest advances have come amid strong crypto-native catalysts, including optimism that U.S. regulators will soon approve the first spot Bitcoin exchange-traded fund (ETF), which is expected to usher in a fresh wave of investor interest. Geopolitical risks from conflict in the Middle East also have renewed calls of Bitcoin as “digital gold,” with some traders seeing the token as a haven asset in times of turmoil.
But the latest catalyst buoying Bitcoin—as bullish traders call for gains to $40,000 or even $$50,000—is upbeat sentiment in wider markets that the Fed has finished raising interest rates. Like the
Dow Jones Industrial Average
and
S&P 500,
Bitcoin is sensitive to the outlook for rates, since elevated rates tend to dampen demand for riskier bets like stocks and cryptos.
On the back of the Fed’s latest monetary policy decision and a weaker-than-expected U.S. jobs report last Friday, markets are more firmly pricing in the prospect that the Fed will not hike borrowing costs any further. The odds of another rate-hike from the Fed after its meetings in the coming December, January, March, and May all have fallen significantly from a week ago, according to the CME FedWatch Tool.
Beyond Bitcoin,
Ether
—the second-largest crypto—has risen 0.2% to just shy of $1,900. Smaller tokens or altcoins were higher, with
Cardano
rising 5% and
Polygon
up 3%. Memecoins were more mixed, with
Dogecoin
up 4% but
Shiba Inu
hovering around flat.
Write to Jack Denton at jack.denton@barrons.com
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