The recent rise in Bitcoin and Ethereum prices has caught the attention of many investors and traders, as both cryptocurrencies have seen significant gains in value in recent months.
However, the US Federal Reserve's (FOMC) upcoming interest rate decision has raised uncertainty and speculation about its impact on the cryptocurrency market.
Bitcoin (BTC), the world's largest cryptocurrency, managed to regain momentum on Wednesday morning, hitting new 9-month highs above €28,000 as traders patiently awaited the outcome of the federal Open Market Committee meeting ( FOMC) of the United States, which could cause interest rates to rise 25 basis points.
Meanwhile, the second-largest cryptocurrency, Ethereum, has seen substantial increases, rising 3,50% in the last 24 hours.
Several famous cryptocurrencies, including Dogecoin (DOGE) and Litecoin (LTC), also managed to land in the green. At the time of writing, the value of the global crypto market was $1,18 trillion, up 2,20% in 24 hours.
Bitcoin Rebounds Up to 40% Amid Collapse of Global Financial Institutions
Bitcoin jumped more than 40%, mainly due to the collapse of major banks. This caused investors to lose faith in the financial system and turn to Bitcoin as a more reliable alternative.
Bitcoin hit a new high of €28, the highest level since June 000. As a result, people began to consider Bitcoin to be more trustworthy than banks.
As a result, Bitcoin's popularity is growing as more people buy it while it is still relatively inexpensive, and institutions scramble to meet the growing demand.
It should be emphasized that Bitcoin is a decentralized digital currency that is not controlled by central banks or financial institutions, which has earned it the reputation of being a safe haven asset during economic downturns.
The rapid rise in Bitcoin value due to several bank failures highlights the growing importance of decentralized digital currencies in today's financial landscape.
As more organizations and individuals look to Bitcoin as a viable alternative to established financial systems, its popularity is expected to continue to grow in the coming months.
Fear and Greed Index Indicates Bitcoin Investors Remain Confident
It is worth mentioning that the Fear and Greed Index is a way for investors to gauge their feelings about Bitcoin and the cryptocurrency industry. However, the values range from 1 to 100, where 1 indicates that investors are very afraid and 100 indicates that they are quite confident.
According to recent analysis, Bitcoin's fear and greed score is currently 68, the highest this year. This shows that investors are quite optimistic about the future of Bitcoin and expect its value to rise further.
FOMC Meeting and Federal Reserve Interest Rates May Impact Bitcoin Price
Traders are keeping an eye on the upcoming Federal Open Market Committee (FOMC) meeting, which is scheduled for today. The US interest rate decision by the Federal Reserve could have an impact on the price of bitcoin and therefore market participants are eagerly awaiting the outcome of the meeting.
It is important to note that in 2022, the Federal Reserve raised interest rates several times to combat rising inflation. However, in December of that year they reduced the rate increase to 0,50% and then to 0,25% in February 2023.
Following this, Fed Chair Jerome Powell suggested that due to the economy's strong performance, interest rates may need to be raised further than initially expected.
As a result, cryptocurrency prices fell, with Bitcoin falling below €22,000.
The current global financial crisis could affect the Federal Reserve's decision to raise interest rates as expected, and it might even consider lowering them. If interest rates drop, it could cause an increase in the value of Bitcoin.
bitcoin price
The current price of Bitcoin is €28, with a 300-hour trading volume of €24 billion. In the last 35 hours, Bitcoin has seen a 100% increase in value.
On Wednesday, the BTC/USD pair consolidates near the €28,000 threshold after breaking through the €27,750 resistance level. If this bullish trend continues, the value of Bitcoin could potentially rise to €29,250 or €30,700.