Bitcoin broke out of its correction mode after the Federal Reserve maintained its key interest rate. The cryptocurrency market is hopeful after the FED’s move. Bitcoin and Ethereum are leading the bullish rally once again followed by memecoins. The FOMC maintained the interest rate at 5.25%–5.50%. This is the FOMC’s fifth consecutive unchanged decision. The market knew what the FOMC would say, but their tone and Federal Reserve Chairman Jerome Powell’s press conference gave investors hope.

Bitcoin Hits $66,830.30 After Fed Chairman’s Remarks on Economy

Powell was dovish at his press conference, saying he would ignore inflation because the job market was weak. He implied that the FED would continue loose monetary policies to boost the economy, which boosted investor confidence in risky assets like cryptocurrencies.

$BTC and $ETH prices rose quickly after Powell’s speech. Bitcoin is currently the most widely used cryptocurrency, with a current trading price of $66,830.30. The price increase indicates that investors are again interested in cryptocurrencies and are using them to hedge against inflation and uncertainty in traditional financial markets. Yesterday, BTC shorts dominated which suggested a price hike.

Since funding rates haven’t changed much, market analysts say Bitcoin and Ethereum’s recent rise is mostly due to spot demand. Thus, real buyers, not market players, are driving the price rise.

Analysts Warn of Crypto Volatility Despite Recent Price Surge

The Fed kept interest rates the same due to inflation concerns and the economy’s rapid recovery. In recent months, supply chain issues, higher energy prices, and high consumer demand have driven inflation to its highest level in decades. Powell’s comments suggest that the FED is still focused on supporting the job market and economy rather than inflationary pressures.

The FED’s “dovish” stance has boosted risky assets like cryptocurrencies. Many see cryptocurrencies as a hedge against inflation and fiat currencies. Bitcoin has become the best way for investors to hedge against fiat currency depreciation.

Despite the recent rise, some analysts warn that Bitcoin and other cryptocurrencies are still volatile and can change prices quickly. Regulatory uncertainty, weak technology, and market mood can affect cryptocurrency prices temporarily.

Bitcoin and Ethereum’s recent price increases show that more people are considering cryptocurrencies as investments. Cryptocurrencies offer high returns and diversify portfolios, so institutional investors, corporations, and individual traders are adding them.

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