Bitcoin
BTCUSD
surged to two-week peaks on March 20 fueled by speculation that the US government was readying a “significant update” to its cryptocurrency policies.
Fed’s Powell brings optimism to stocks, crypto
According to data from Cointelegraph Markets Pro and TradingView,
BTCUSD
approached nearly $87,500 on Bitstamp.
Currently holding steady near $86,000, Bitcoin gained from a rather calm Federal Reserve meeting the previous day, where officials decided to maintain interest rates at their current levels.
Policymakers indicated that they foresee two rate cuts occurring by the end of 2025, with Fed Chair Jerome Powell noting that inflation has “eased significantly.”
“We do not need to rush to change our policy stance, and we are well-equipped to wait for greater clarity,” he stated in an initial address before a following press conference regarding the rates decision.
A “wait-and-see” strategy was sufficient to provide relief to distressed risk assets, with Bitcoin rising alongside US stocks, finishing the day on a positive note. The S&P 500 gained about 1% during the March 20 session, adding $500 billion to its market capitalization.
In response, Arthur Hayes, former CEO of crypto exchange BitMEX, remarked that the Fed had sent a crucial signal for traders to take on more risk.
“JAYPOW has delivered, QT basically concludes on Apr 1. The next major excitement we need is either SLR exemption or a restart of QE,” he posted on X, alluding to the shift from quantitative tightening to quantitative easing.
“Was $BTC $77k the bottom? Probably. But stocks may still have some pain left before fully converting Jay to team Trump, so stay prepared and liquid.”
Bitcoin traders anticipate US crypto announcement
Nonetheless, Bitcoin traders were primarily focused on potential shifts in US crypto strategies, as rumors suggested an announcement could be made on March 21.
“This would mark the first significant update since March 6th, when the national crypto reserve was formed,” trading resource The Kobeissi Letter summarized in an X post regarding the matter.
“Speculation suggests President Trump might be implementing a major change to his approach.”
When Trump enacted an executive order to establish a Strategic Bitcoin Reserve earlier this month, the markets displayed surprising stability as it became clear that the plan wouldn’t necessarily involve the US purchasing BTC.
However, following the latest daily close above key resistance levels, optimism was rapidly resurfacing.
“Bitcoin only needs to rise another +8% to prepare for reclaiming the upper Range and end this downward deviation,” popular trader and analyst Rekt Capital noted.
“Is that too much, considering BTC has already increased nearly +13% since last week’s lows?”
This article does not provide investment advice or recommendations. Every investment and trading decision carries risks, and readers should conduct their own research prior to making any decisions.
