Bitcoin soared to a fresh all-time high on Sunday night, as investors eagerly anticipated a potential interest rate cut from the Federal Reserve later this week.
The cryptocurrency’s price surged over 4%, reaching $105,207. Earlier in the day, it hit a new record of $106,509, according to Coin Metrics. Ether, another major player in the crypto world, followed suit with a 4% rise, coming close to the $4,000 mark. Overall, the crypto market showed strong momentum, with the CoinDesk 20 index climbing 4%.
Meanwhile, crypto-linked stocks like Coinbase and MicroStrategy didn’t show much movement in premarket trading. MicroStrategy did make headlines, though, with news that it will soon be added to the Nasdaq 100 index and the widely traded QQQ ETF.
Bitcoin’s latest rally coincided with a modest gain in the tech-heavy Nasdaq Composite, which edged up 0.3% to end last week on a positive note.
The excitement in the crypto market is largely tied to expectations that the Fed will announce a 0.25% interest rate cut during its two-day meeting ending on Wednesday. According to the CME FedWatch tool, there’s a 96% chance of this happening. Lower interest rates tend to boost assets like bitcoin, which often behaves like a tech stock.
A rate cut could also weaken the dollar and increase the money supply—factors that have historically worked in bitcoin’s favor.
Bitcoin has had an impressive run this year. It’s up nearly 8% this month, 50% since the U.S. presidential election, and a whopping 145% for the year. Optimism surrounding a potentially crypto-friendly regulatory landscape and discussions about a national bitcoin reserve under the incoming Trump administration have only added fuel to the fire.
For now, bitcoin continues to capture the spotlight, with many wondering just how high it can go.
