Bitcoin hits all-time high as market awaits Fed rate cut

Souvenir tokens representing cryptocurrency Bitcoin and the Ethereum blockchain, with its native token, Ether, plunge into water. [REUTERS/YONHAP]

 
Bitcoin surged to an all-time high on Wednesday, breaking the record set just a month ago.
 
The token climbed 2.96 percent in 24 hours to hit $123,677 at 7:41 p.m. Eastern time, surpassing the previous peak of about $123,200 that it hit on July 14, according to Coinbase, a U.S.-based cryptocurrency exchange.
 
Ether, the second-largest cryptocurrency by market value, also rose 3.56 percent to $4,785, its highest level since November 2021, and edged closer to its record of about $4,800 from the same month.
 
Other major digital assets posted strong gains. Solana rose 5.11 percent to $202.61, topping $200 for the first time in months. dogecoin advanced 4.22 percent to $0.25, while XRP, the third-largest cryptocurrency, climbed 0.64 percent to $3.29.
 
Analysts pointed to macroeconomic data as a catalyst. U.S. inflation figures released this week matched forecasts, bolstering expectations that the U.S. Federal Reserve will cut interest rates in September.
 
“Credit spreads, loan growth and even the Fed’s balance sheet mechanics are flashing signals that rarely align this way,” cryptocurrency firm 10X Research said in a report published Wednesday.
 
10X Research added that although the Federal Reserve remains reluctant to cut interest rates, if it changes course, investors will quickly shift their funds into high-risk assets.
 
Markets are pricing in more than a 90 percent chance of a quarter-point rate cut at the September Federal Open Market Committee meeting, according to the crypto news outlet CoinDesk. But calls for deeper monetary easing are growing.
 
10X Research also noted that “Bitcoin, small caps and other risk assets are starting to respond, but the real trigger may still be ahead,” leaving room for further upside.

BY JEONG HYE-JEONG [[email protected]]

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