For the price bitcoin Even as they hit new highs, the upbeat numbers aren’t good for everyone and could signal a bubble that’s spooking the Federal Reserve.
A surge in the biggest digital assets and related assets could prevent the Federal Reserve from easing monetary policy as expected, Marko Kolanovic, chief market strategist at JPMorgan Chase & Co., said in a research note.
“Monetary policy could be kept higher for longer because a hasty interest rate cut risks further rises in asset prices or further rises in inflation,” Kolanovic said, referring to Bitcoin’s rise above $60,000.
The multinational bank strategist went on to argue that the rebound in technology stocks and Bitcoin is a sign of a “bubble” in the market and could lead to a price rebound.
Market bubbles were also on the mind of Patrick Felder, founder and CIO of Prismatic Capital.
“I am confident that federal government officials will review Bitcoin price movements, but this is just one of hundreds of things they review,” Felder said. decryption. “Bitcoin price alone has no impact on Fed policy, but it is an interesting data point to measure market liquidity and bubbles.”
“Personally, since this is an election year, we will still be cutting the budget, but we will have a higher budget than expected in 2025,” he continued.
Bitcoin on Tuesday beat briefly Coinbase, the largest cryptocurrency exchange in the United States, has reached an all-time high.
then fell quickly However, it is still trading at $67,376. according to On CoinGecko. This is a 57% increase since the beginning of the year. The last time Bitcoin hit $69,000 per coin was in November 2021.
In 2022, the Federal Reserve began aggressively raising interest rates to control the highest inflation in 40 years. Stocks and cryptocurrencies (both “risk assets”) were negatively impacted as investors retreated to the dollar.
But as demand for technology soared, stock markets improved and cryptocurrency markets soared as well. Additionally, the Federal Reserve is expected to ease monetary policy and eventually cut interest rates, which could benefit the cryptocurrency market, analysts say. said Decrypt.
This, along with the hugely successful Bitcoin Exchange Traded Fund (ETF), has driven prices in the digital asset market higher. And the Bitcoin halving, which takes place every four years, is just one month away. This is a milestone that usually precedes a new all-time high price.
Edited by Ryan Ozawa.
