Bitcoin continued its five-session winning streak and neared $71,000 amid growing expectations of a Federal Reserve interest rate cut later this year.
The cryptocurrency’s continued upward momentum has seen Bitcoin post its longest daily rally in three months, with Bitcoin trading at $70,785 in New York as of 8:25 a.m. Wednesday, up from the all-time high of $73,798 it reached in mid-March. This is only 4% lower than before.
Investors are increasingly considering the possibility of a Federal Reserve interest rate cut as early as November due to signs of easing U.S. inflation and a slowing job market. This shift in market sentiment has led to a notable decline in Treasury yields over the past two days, easing financial conditions and strengthening speculative assets such as cryptocurrencies.
According to Tom Couture, vice president of digital asset strategy at Fundstrat Global Advisors, the positive response from cryptocurrency assets can be attributed to falling interest rates.
The cryptocurrency rally is not limited to Bitcoin, with other top coins such as BNB and Solana also seeing gains over the past 24 hours. Notably, BNB has hit previous highs in 2021, reflecting improved sentiment towards the Binance ecosystem despite regulatory issues earlier this year.
Bitcoin faces resistance in maintaining its position above $70,000, but optimism continues due to increased inflows into US-only exchange-traded funds and ongoing developments on the cryptocurrency regulatory framework in Washington.
Elsewhere in Japan, cryptocurrency exchange DMM Bitcoin announced plans to raise funds to compensate customers affected by recent hacks, highlighting the industry’s ongoing challenges.
Amid these developments, the correlation between the Nasdaq 100 index of US technology stocks and Bitcoin has reached its highest level since early 2023, suggesting a potential coincidence between the stock market rally and further appreciation in the cryptocurrency market.
Michael Novogratz, founder and CEO of Galaxy Digital, expressed optimism about Bitcoin’s future thanks to a more favorable regulatory environment in the United States, reaching an all-time high of over $100,000 by the end of the year. was expected to record. This positive sentiment reflects a shift away from the uncertainty and scandals that have plagued the cryptocurrency market over the past few years.
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