The broader cryptocurrency market is up by 1.78% over the last 24 hours despite the Fed announcing a 25 basis points rate hike during the FOMC meeting on Wednesday, May 3. Yesterday’s rate hike by the Fed was on the expected lines and it seems that the crypto investors have decided to look past it.
Although the US indices ended in the red on Wednesday, the crypto market refused to budge. Today’s move is a hint of the further decoupling of the crypto market from US equities.
Well as things are clear for the time being, crypto investors no longer need to worry about the fiscal policy until June this year. However, the interest rates being over 5% over the last 14 months, isn’t an ideal scenario. But as the crypto market decouples further from equities, it seems that crypto is taking a turn for the better.
Bitcoin Price Shoots Above $29,000
In hours after the US Fed announced the rate hike, the Bitcoin price gained more than 2% moving once again past $29,000. During this week, Bitcoin (BTC) has recovered most of its lost ground as investors eye a crucial breakout above the $30,000 resistance level.
Interestingly, the BTC price pump on Wednesday came with the blockchain’s address activity jumping to a two-week high. On-chain data provider Santiment reported:
This rally seemed to be much more related to the rate hike finally being official, and you can see how active addresses pushed even higher directly after the announcement.
It also explained that there aren’t any extreme short positions built over some of the largest cryptocurrencies by market cap. On the other hand, Bitcoin and the broader crypto market have shown greater resilience to the banking crisis in the US. It will be interesting to see whether Bitcoin and crypto can continue their price performance amid the future unfolding macro conditions.
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