Bitcoin continues its upward trend following the Fed meeting and Powell’s comments

Bitcoin continues to rise following the Federal Reserve’s (FED) recent monetary policy meeting and President Jerome Powell’s remarks on cryptocurrency regulation.

Market Performance

The leading digital asset increased by 1% at the opening of Asian markets, reaching around $105,000. Since the U.S. market opened, Bitcoin has gained 3.5%. Smaller tokens like Ether and Solana also saw significant increases.

Federal Reserve’s Announcement

On Wednesday, Fed officials announced a halt to monetary expansion. Powell indicated that the central bank needs to see more progress on inflation before considering further interest rate cuts.

Powell’s Remarks on Crypto

In response to a question about the risks of digital assets, Powell stated that banks could serve crypto customers effectively if they understand and manage the risks. He also suggested that a broader regulatory framework from Congress would be constructive. These comments came at a time when investors, especially those aligned with former President Donald Trump’s administration, are optimistic about favorable digital asset regulations.

Analyst Insights

Tony Sycamore, a market analyst at IG Australia Pty, commented, “U.S. investors reacted positively to Powell’s comments on crypto, leading to Bitcoin’s rise. From a broader technical perspective, there are signs that the Bitcoin rally is maturing.”

Historical Context

Bitcoin reached a record high of $109,241 before Trump took office on January 20 but later declined. Since the election victory in early November, the token has surged by over 50%. This raises questions about whether the rally needs a pause. However, some believe that increased engagement with crypto in the U.S. could lead to further gains.

Recent Developments

Recent developments include Robinhood Markets Inc. offering futures products, including Bitcoin and Ether, on its app under the CME Group Inc. umbrella. Investment firms are also submitting numerous proposals for new cryptocurrency exchange-traded funds (ETFs) to the Securities and Exchange Commission (SEC). Bloomberg Intelligence Senior Analyst Nathan Dean noted, “The SEC’s boundaries are being tested, and unique filings like memecoin ETFs are being prepared.” Recent movements in Bitcoin have shown a correlation with U.S. tech stocks, highlighting the growing intersection between digital assets and traditional markets.