Bitcoin has rebounded above $67,000 (£524,900) on Thursday morning. The rise comes after US Federal Reserve decision to hold interest rates at their current levels, as announced in a Federal Open Market Committee (FOMC) statement on Wednesday.
The FOMC decided to keep the benchmark federal funds rate within the range of 5.25% to 5.50%.
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The Federal Reserve chair Jerome Powell said the US central bank expects to make rate cuts “at some point this year.” He stressed that inflation has eased substantially but is still too high, and the Fed will need to adjust their monetary policy approach meeting by meeting as it monitors inflation.
Following the FOMC meeting, bitcoin (BTC-USD) increased by over 7% in the past 24 hours, reaching a daily high of $67,700. The uptick follows a downturn in early trading on Wednesday, reaching a low of about $61,500.
The world’s largest digital asset by market cap is still down from reaching an all-time high of above $73,000 one week ago.
Last Thursday, bitcoin hit record high $73,580, according to CoinGecko data, its price bolstered by increased inflows from fund managers such as BlackRock (BLK) and Franklin Templeton (BEN), via spot bitcoin exchange-traded funds (ETFs).
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Bitcoin’s price has gained 30% in the past month alone, a price appreciation that has been driven by record inflows into multiple US-based spot bitcoin ETFs which were approved in January of this year.
A spot bitcoin ETF is a financial product that many investors see as opening the gateway for mainstream capital to flood the crypto market.
Reasons for long term bitcoin optimism
According to Oppenheimer Executive Director Owen Lau there are multiple reasons to remain optimism for bitcoin’s prospects in the long term.
“Over the long term, we are still optimistic because of a couple reasons. Number one, we still see further adoption for spot bitcoin ETF. We are just still in the early innings. Remember, bitcoin is a global phenomenon. So I think BlackRock listed in US and they just listed IBIT, their spot bitcoin ETF in Brazil. So you can tell many of these asset managers can list this product overseas. You can also buy bitcoin in Asia, in Singapore and also in Europe,” Lau told Yahoo Finance.
Read more: Long-term bitcoin optimism still warranted: Analyst
Traditional markets also experienced gains following the Federal Reserve’s statement. The S&P 500 index surged by 1.2% to close at 4,839.8, reaching a new all-time high and surpassing the previous record set in January 2022, while the Nasdaq-100 recorded a gain of 1.3%.
Additionally, the US dollar index (DXY), which gauges the dollar’s strength against other major currencies, decreased by nearly 0.7% from its session peak, indicating heightened investor risk appetite.
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