Bitcoin hit a new all-time high Monday as investors awaited an expected interest rate cut by the Federal Reserve later this week.
The price of the flagship cryptocurrency recently rose almost 3% to $106,126.74, according to Coin Metrics. Previously, it reached $107,229.38, a new record high. Ether rose 3% to cross the key $4,000 level. The broader crypto market, as measured by the CoinDesk 20 Index, traded up more than 1%.
Crypto stocks have given back their earlier gains. Coinbase increased by more than 1%. Bitcoin Proxy Actions MicroStrategy fell below the flat line after jumping as much as 7%, following Friday evening’s announcement that MicroStrategy would join the Nasdaq-100 stock index and was heavily traded QQQ ETF later this month.
MicroStrategy founder Michael Saylor also announced that the company purchased an additional 15,350 BTC, bringing its total holdings to 439,000, worth approximately $46 billion.
Bitcoin hits new level above $106,000
Investors expect the Fed to cut interest rates this week at its two-day policy meeting, which ends Wednesday. The CME FedWatch tool currently projects a 96% probability of a 25 basis point cut. This would likely be positive for the price of bitcoin, which often trades like a tech stock and therefore benefits from lower interest rates.
Lower interest rates also imply a weakening dollar and a growing money supply, both of which have demonstrated long-term correlations with bitcoin.
Bitcoin is now up 9% for the month, 52% since the US presidential election and 149% for the year. The promise of a friendlier regulatory environment and the potential creation of a national strategic bitcoin reserve in the new Trump administration continues to be a positive catalyst for digital assets and cryptocurrencies in general.
