Bitcoin (BTC) and ether (ETH), the top two cryptocurrencies by market value, maintained stability during the early European hours as stock futures surged, ignoring the overnight 25 basis point rate hike by the Federal Reserve (Fed), according to experts.
According to CoinDesk data, the price of BTC, the largest digital currency in the world, was $29,429, while the price of ether was $1,875, up 1.24%.
Despite the advances, bitcoin is still far from its all-time high, which it reached in July at $31,800, and is generally immune to macroeconomic factors that in the last year have caused more pronounced price reactions.
As linked institutional investment products got inflows in July as a result of Ripple’s partial court victory over the SEC in the middle of the month, stellar (XLM) and solana (SOL) also enjoyed gains of up to 13%.
“On one side, the bulls are waiting for further signals for the Bitcoin ETF SEC decision in August and positioning for the 2024 halving,” Adrian Wang, CEO of Metalpha, said to CoinDesk. The bears are preparing for another probable dip before the 2024 halving, similar to what happened in 2019, while the bulls are prepared for a lot of profit-taking when the spot is above 30k.
The Fed’s announcement “doesn’t change the story related to crypto,” according to Lex Sokolin, managing partner of Web3 investment fund Generative Ventures. We already live in a risk-averse atmosphere. War or a recession could make things worse, but technology and finance are at a reasonably stable, compressed valuation, with AI possibly being an aberration.
“Because the Fed’s interest rate increase was widely anticipated, the market’s reaction has been relatively calm. Greta Yuan, Head of Research at Hong Kong-based digital asset platform VDX, told CoinDesk in a note that it is worthwhile to keep an eye on whether the most recent rate increase signals the conclusion of the current cycle of rate increases.
The Fed Chair, Jerome Powell, remarked in a news conference on Wednesday that “we can afford to be a little patient, as well as resolute, as we let this unfold. “We believe we will need to maintain the policy at its current restrictive levels for a while, and we would be willing to raise it further if we believe it is necessary.”