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Bitcoin Blasts Through $23.5K as Powell Speaks Following Fed Rate Hike
The U.S. central bank earlier Wednesday lifted its benchmark interest rate 25 basis points.
Updated Feb 2, 2023, 4:36 p.m. Published Feb 1, 2023, 8:40 p.m.
Bitcoin jumped $700, moving above $23,600, as Federal Reserve Chair Jerome Powell suggested the U.S. central bank is seeing signs of waning inflation.
Prior to Powell speaking, the Federal Open Market Committee – as expected – lifted its benchmark interest rate by 25 basis points to a new range of 4.5%-4.75%, the highest level in 15 years. In its policy statement, the central bank said “ongoing increases” in borrowing costs will be necessary to further cool inflation.
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Data from the CME Group now shows investors pricing in an 86% chance of another 25 basis point rate hike to a range of 4.75%-5.00% at the FOMC’s March meeting.
At his post-meeting press conference, Powell led off in a hawkish fashion, reminding reporters of the destructive nature of inflation and promising the Fed’s commitment to bringing inflation down to the 2% target.
Further along in the press conference, however, Powell said that “[the] disinflationary process has started.” Those words sent bitcoin and traditional equity markets sharply higher.
The largest cryptocurrency by market capitalization, bitcoin (BTC) was trading as high as $23,627 following the comments, up more than 2% for the day. At press time, it’s settled back to $23,600. The Nasdaq is now ahead 2.6% and the S&P 500 1.6%.
Ether (ETH), the native token of the Ethereum blockchain, rose 3% to trade at $1,635 as of press time.
Crypto-exposed stocks also gained, with exchange Coinbase (COIN) rising 8% and bitcoin miner Marathon Digital Holdings (MARA) up 7%.
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Bitcoin’s Long-Term Holders Hit Cyclical Low as Sell Pressure Finally Eases
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What to know:
- Long-term holder supply fell to 14.33M BTC in November, its lowest level since March, coinciding with bitcoin’s $80K correction low.
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- Unlike prior cycles, LTH behavior in 2025 shows more measured distribution rather than blow-off-top capitulation, signaling a shift in market structure.
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