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- Bitcoin (BTC) attractiveness and growth have sparked a broad recovery for altcoins.
- The latest stance of the Federal Reserve on interest rate pause is one of the recent catalysts fueling growth.
The broad cryptocurrency market has been on a recovery streak since Tuesday when BlackRock applied for a spot Bitcoin (BTC) Exchange Traded Fund (ETF) from the United States Securities and Exchange Commission (SEC). Much more, the price rally of many cryptocurrencies hit new levels on Wednesday with BTC and Ethereum (ETH) prices nearing a six-week high after U.S. Federal Reserve Chair Jerome Powell talked about pausing the interest rates.
Jerome Powell revealed to the U.S House Financial Services Committee that the interest rate pause is temporary. The Fed boss also mentioned the possibility of rate hikes happening soon as inflation is still higher than expected. Even the CME FedWatch Tool has predicted the probability of a 25 Basis Point Hike (BPS) hike at the July 26 FOMC meeting to be around 80%.
His statement has bolstered the broad crypto market as Bitcoin formed a new support level of $30,000 earlier today.
Currently, the leading cryptocurrency by market capitalization is trading at $30,078.89, indicating a 3.40% increase in the last 24 hours. While ETH is trading at $1,897.24, a 4.09% increase under 24 hours. In terms of market capitalization, Ether is leading other altcoins and has established its position as the second leading cryptocurrency by market cap. Ethereum market cap hit 231.25 billion amidst the recent rally.
Way before the price rally began, BitMEX Co-founder Arthur Hayes was optimistic about a market rebound. He pointed out that the U.S. Treasury General Account (TGA) refill’s impact on the liquidity of the dollar is not as critical as anticipated therefore, risk assets like Bitcoin will see their prices rally in no distant time.
Major Bitcoin Price Rally Catalysts
Noteworthy, the effect of Powell’s statements during this meeting may not come as a surprise to many as it had earlier been highlighted as an economic metric to look out for in the crypto market.
The other economic data listed were new data from the U.S. housing market, the preliminary figures for the U.S. building permits for May, presentation of the current sales figures for existing properties in the U.S. housing market and presentation of the purchasing managers’ indices from the service sector for the U.S.
Moreso, the daring move by BlackRock has hinted at a revolution in the crypto ecosystem. Due to the sterling reputation and the size of the investment asset management firm, institutional investors have begun to flock round Bitcoin and this increased demand now serves as a catalyst to the coin’s price recovery. At the same time, BlackRock has spurred other investment managers like WisdomTree, Fidelity, and Invesco to also reapply for a spot BTC ETF. Investment company Valkyrie is the latest to jump on this spot BTC ETF train.
