Bitcoin (BTC) Price Rises After Stocks Rise Following Fed Rally

Bitcoin prices were under pressure in 2022 following the crash of algorithmic stablecoin terraUSD and subsequent bankruptcy filings from lender Celsius and hedge fund Three Arrows Capital.

Nicolas Economou | Nurfoto | Getty Images

bitcoin fluctuated around $24,000 on Friday, reaching a 6-week high, continuing to follow the rise in stock markets.

The world’s largest digital currency hit $24,412 at 2:30 am ET Friday, the highest level in more than six weeks, according to data from CoinDesk. Bitcoin has since slashed some of those gains and topped $24,000 at 6:32 AM ET.

The Bitcoin Rally Begins after the Federal Reserve interest rate hike on Wednesday, but signals that the pace of such growth may slow down. This caused a rally in the US stock markets.

Changes in cryptocurrencies have been broadly in line with U.S. equities lately, in particular tracking the high-tech Nasdaq, which has surged over the past two days.

Other cryptocurrencies including ether were sharply higher on Friday.

“Overall, I think markets have responded positively to the Fed’s comments and may have accounted for most of the rate hikes,” Vijay Aiyar, vice president of corporate and international development at crypto exchange Luno, told CNBC in a text message.

“There seems to be a lot of liquidity on the sidelines that is now coming in due to the last few months of consolidation/downward pressure now easing,” he added.

However, bitcoin has fallen about 48% this year and remains more than 60% below its all-time high price of $68,990.90, which was reached in November.

The cryptocurrency market is suffering from a number of problems, including the collapse of the algorithmic stablecoin terraUSDwhat triggered the chain of events that led to bankruptcy credit platform Celsius as well as hedge fund Three Arrows Capital.

Market participants are trying to figure out where the bottom is for bitcoin and whether deleveraging and the shake-up in the industry are over. This was reported to CNBC by market participants. that they want to see the macroeconomic picture improve and deleveraging complete before the bitcoin bottom is found.

Bitcoin has been trading in a range of $18,000 to just over $24,000 since mid-June, and Luno’s Aiyar said investors have been hoarding bitcoin at those prices.