Although Bitcoin did not immediately react to the US Fed interest rate hike, the asset went on a tear hours later, reaching a new high in over five months. On a daily basis, most altcoins have made even more impressive gains, with ETH previously reaching $1,700.
Bitcoin has risen above $24,000.
The primary cryptocurrency had its best January since 2013, with a monthly gain of nearly 40%. This came as the asset finally broke through the $17,000 barrier at the start of the year, rising to nearly $23,000 by the end of the month.
However, there were some expectations of increased price volatility yesterday, February 1, as the US Federal Reserve concluded its first FOMC meeting of the year. Most forecasts predicted that the central bank would raise interest rates by 25 basis points, which is considered bullish for risk-on assets given previous hikes of 75 points.
The Fed followed through, raising interest rates to 4.75%, and Powell hinted at only a couple more increases.
BTC did not respond at first, but the landscape changed in the hours that followed. The asset first fell below $23,000 before rising to $24,350. (on Bitstamp). This is the highest price since mid-August 2022.
Bitcoin has lost some of its value since that local high, but it still trades in the green on a daily basis. As a result, its market cap has surpassed $460 billion, and its dominance over the alts is at 42.2%.
Alts are also on the rise.
Alternative coins were also quiet yesterday ahead of the FOMC announcement, but most are now on a tear.
Ethereum is at the forefront of the charge. The second-largest cryptocurrency had previously touched $1,700, and while it is currently trading below that level, it is still up more than 6% on the day. Binance Coin (7.5%) has reached a high of $330. Cardano, OKB, Solana, Polkadot, Uniswap, Litecoin, and Shiba Inu have all seen similar gains.
Polygon and Avalanche have the highest price increases in a single day, at 14% and 15%, respectively. As a result, MATIC is trading at $1.22, while AVAX is just shy of $22. Lower- and mid-cap alts are also seeing similar gains. As a result, it’s no surprise that the total crypto market cap has increased by more than $30 billion per day and is now close to $1.1 trillion.