Bitcoin’s value saw a comeback rising above $43,000, following speculation of another potential pause in rate adjustments by the U.S. Federal Reserve later this week. For the first time in two weeks, Bitcoin’s price rose above $43,000 on Monday. The market is rife with conjecture about the Federal Open Market Committee meeting where a rate pause is anticipated.
There are indications that the outflows from Grayscale Investments’ bitcoin ETF could be diminishing. ETF analyst, James Seyffart, commented that one of the recently introduced funds might end up trading more than the Grayscale Bitcoin Trust.
Over $60 million of cryptocurrency short positions were liquidated on Tuesday, with Bitcoin leveraged positions of over $40 million being liquidated within 24 hours, according to data from Coinglass. Moreover, short liquidations contributed over $24 million that was leveraged in Bitcoin. As of 12:00 p.m. ET, the most substantial digital asset per market capitalization, had a 2% increment in the last 24 hours, trading at $43,201 according to The Block data.
In the lead-up to the U.S. Federal Reserve’s FOMC meeting this week, the market anticipates a standstill in rates. As suggested by the CME FedWatch tool, there is a considerable 97.9% probability that the Fed funds rate will remain in its current target range of 5.25–5.5%.
Bitcoin is considered as a “risk-on” asset by Ryze Labs, signifying its potential to prosper in a strong bull market, particularly if there’s a pause in the rate followed by rate cuts. But, the Founder of Ryze Labs, Mathew Graham, has indicated that the market has already factored in the prediction of a rate pause by the Federal Reserve.
However, if the Fed makes cuts to the interest rates beyond what’s currently anticipated, it could potentially be a positive market turn for Bitcoin. The Ryze Labs team further adds that the institutional interest in Bitcoin will continue to evolve over time, with an anticipated surge in inflows for the bitcoin ETF as fund managers increase sales cycles.