Bitcoin Hits $62k as Fed Cuts Interest Rates by 50 Basis Points

TL;DR

• BTC is up 2% in the last 24 hours and now trades above $62k.

• The rally comes after the Federal Reserve cut interest rates by 50 basis points to the 4.75%-5.00% range.

BTC Surges Above $62k as Fed Cuts Interest Rates

The cryptocurrency market has continued its positive run as most coins and tokens are currently in the green. Bitcoin, the leading cryptocurrency by market cap, is up 2% in the last 24 hours and trades above $62k per coin.

At press time, Bitcoin’s price was $62,094. The rally came after the Federal Open Market Committee (FOMC) cut the benchmark federal funds rate by 50 basis points to a lower range of 4.75% and 5.00%.

The Fed stated that,

"Recent indicators suggest that economic activity has continued to expand at a solid pace. Job gains have slowed, and the unemployment rate has moved up but remains low. Inflation has made further progress toward the Committee's 2 percent objective but remains somewhat elevated. The Committee has gained greater confidence that inflation is moving sustainably toward 2 percent and judges that the risks to achieving its employment and inflation goals are roughly in balance."

Bitcoin’s rally sparked positive performance amongst other leading cryptocurrencies. Ether is up 4% in the last 24 hours and is now trading above $2,400 per coin. Solana’s SOL is the best performer amongst the top 10 cryptocurrencies by market cap, up 5.5%.

While commenting on the rate cut, Chris Aruliah, Bybit’s Head of Institutional, said

“Historically, a rate cut has often led to an influx of capital from banks into the stock market, as lower interest rates drive more investment into riskier assets, including digital currencies, due to the diminished returns from traditional investment vehicles.

Therefore, while a 0.5% reduction in the Fed’s policy rate may provide a short-term boost to the cryptocurrency market, it is crucial to remain vigilant regarding the potential challenges posed by economic uncertainty and market fluctuations.”

Thanks to the rally, the total cryptocurrency market cap reached $2.15 trillion for the first time in over two weeks.