Mar 21 2024: Bitcoin’s price experienced a notable rebound, surging to $66,540.9 after recent losses, in line with a broader market rally driven by expectations of interest rate cuts in 2024 signaled by the Federal Reserve.
The cryptocurrency market saw Bitcoin rise by 7.9% following a dip to $60,000 on Wednesday, which was attributed to substantial profit-taking after Bitcoin reached record highs the previous week.
A key factor contributing to Bitcoin’s recovery was the weakening of the dollar post-Fed announcement, as the greenback retreated from two-week highs. This favorable trend also supported Ethereum, the second-largest cryptocurrency, which climbed by 10% to $3,454.79 on Thursday.
Bitcoin’s performance tends to thrive in a low-rate environment, making it appealing to investors in such conditions. The Fed’s indication of a 75 basis point reduction in interest rates in 2024, along with Chair Jerome Powell’s acknowledgment of progress toward the Fed’s inflation target, contributed to Bitcoin’s positive sentiment.
The cryptocurrency has already seen substantial gains in 2024, surpassing a 50% increase, following its remarkable rally of over 100% throughout 2023. The recent surge in Bitcoin’s value was fueled by increased capital inflows after the approval of spot exchange-traded funds (ETFs) for U.S. markets earlier in 2024, making Bitcoin more accessible to traditional investors.
Analysts are optimistic about Bitcoin’s potential, with expectations of it crossing the $100,000 mark by the end of 2024. However, the crypto industry still faces challenges, including a loss of trust due to frauds and scandals in recent years, as well as perceived volatility that may deter risk-averse investors.
