Bitcoin soared above the $24,000 barrier, and total crypto market capitalization increased by an impressive 4% after Fed Chair Jerome Powell proclaimed that inflation had started to abate in the world’s preeminent economy.
The Interest Rate Increase Decision Reflected Well On Bitcoin
Through a Federal Open Market Committee briefing on February 1st following the announcement of an interest rate hike of twenty-five basis points, Powell proclaimed that for possibly the first time ever, “the disinflationary process has begun,” which is evidenced by goods prices.
After Powell’s remarks and Fed‘s the rate hike, it seemed that crypto markets appreciated the news. As they had been trading at a flat level before his speech, their market cap jumped by more than $40 billion within hours of hearing what he shared.
The crypto market capitalization globally is presently above $1 trillion, skyrocketing 3.88% over the past 24 hours, as reported by Coinmarketcap’s most recent figures. Bitcoin has also surged to an unprecedented level of more than $24,000 for this year – a monumental milestone reflected in its current rate on Coinmarketcap at a staggering $24,161.27.
The Increase In Interest Rates May Continue For A While
Powell acknowledged that inflation is likely to continue building in the services sector, necessitating “ongoing rate rises” to keep prices stable. He explained that the Fed must persist in its efforts until it achieves its goal of returning inflation to 2%. As such, periodic interest rate increases remain appropriate for this purpose.
The Future Is Uncertain But May Be Hopeful For The Crypto Market
It’s essential to be aware that disinflation is defined as a decrease in the growth rate of general price levels, while deflation implies that prices of goods and services are decreasing. We will observe how governing bodies’ decisions and economists’ judgments affect Bitcoin and other cryptocurrencies.
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