Bitcoin Price Rises After Fed Interest Rates Drop

Bittime - On September 19 2024, Bitcoin managed to exceed $62,000 (around IDR 966,000,000, at an exchange rate of IDR 15,600 per USD) after the Federal Reserve (Fed) announced a 50 basis point cut in interest rates. 

This step is expected to reduce the median benchmark interest rate to 4.4% by the end of the year. However, market sentiment is still mixed, with many parties skeptical about the sustainability of the current crypto price surge.

The Effect of Interest Rate Cuts on the Crypto Market

After the announcement, Bitcoin experienced an increase of 2.4% in the last 24 hours. The CoinDesk 20 index, which measures the performance of the largest digital assets, also posted a gain of 3.4%. 

Other cryptocurrencies, such as Solana (SOL), BNB, XRP, and Cardano (ADA), also felt the positive impact, where SOL recorded the highest increase of 6%. In fact, memecoins such as Dogecoin (DOGE) and Shiba Inu (SHIB) also experienced an increase of around 4%.

Skepticism Among Traders

However, despite this optimism, many traders remain cautious. Chris Aruliah, Head of Institutions at ByBit, stated that while interest rate cuts may provide a temporary boost to the crypto market, the challenges of economic uncertainty and market fluctuations remain to be taken into consideration. 

"Weakening economic indicators and geopolitical complexity are influencing investor sentiment," Aruliah wrote in her statement.

Maelstrom's Arthur Hayes also highlighted that a rate cut may only have a short-term effect. He argued that even though the US economy is showing consistent growth, a potential rise in inflation in the fourth quarter could be problematic. 

"If interest rates continue to be cut, inflation will increase, and this could worsen market conditions," he said.

Read Also: Catizen Listing is Getting Closer, CATI Tokens Will Be Available on Leading Crypto Exchanges

Hopes for Further Interest Rate Cuts

On the other hand, traders at Polymarket expressed confidence that the Fed is not done with interest rate cuts. There is a 41% chance of a further cut of 100 basis points before the end of the year, and 38% of a 125 basis point cut. 

They also forecast a 65% chance of a 25 basis point cut in November.

Other Developments in the Crypto Market

Meanwhile, the privacy-focused Aleo token saw a surge of more than 14% after being listed on Coinbase. Sui (SUI) and Fantom (FTM) also saw double-digit gains, indicating a general recovery in the AI-based token sector. 

Despite this, the relationship between AI tokens and Nvidia shares is starting to weaken, with Nvidia shares down 3% in the last five days.

With interest rate cuts and mixed market reactions, traders and investors need to remain alert and prepared for potential rapid changes in market conditions. Going forward, how the crypto market will react to changes in interest rates is still a big question mark.

How to Buy Crypto on Bittime

You can buy and sell crypto assets easily and safely via Bittime. Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappebti. 

To be able to buy crypto assets on Bittime, make sure you have registered and completed identity verification. Apart from that, also ensure you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application. Study Complete Guide How to Buy Crypto on Bittime. 

Monitor graphic movement of Bitcoin (BTC) price, Ethereum (ETH), Solana (SOL), and other cryptos to find out today's crypto market trends in real-time on Bittime.