Bitcoin Surges Above $76K: What’s Next with the Fed Rate Cut?

Key Takeaways

• Bitcoin set another all-time high last night, rising above $76,000 for the first time.
• The Federal Reserve is expected to lower interest rates today, which could further boost bitcoin prices.
• Spot bitcoin ETFs experienced $621.9 million of inflows on Wednesday, following the clear results of the 2024 U.S. presidential election.

Bitcoin (BTCUSD) was briefly back above $76,000 Thursday as investors await the rate cut decision by the U.S. Federal Reserve.

The largest cryptocurrency by market cap jumped to another all-time high of $76,481 Wednesday amid optimism regarding the election results. Although it stumbled slightly in early trading Thursday, it quickly recovered, coming within striking distance of that level again.

The Fed is expected to cut interest rates by a quarter of a percentage point today. Historically, rate cuts have had a positive impact on bitcoin prices. Lower rates can lead to decreased Treasury and bond yields, making riskier assets like bitcoin more attractive to investors.

Bitcoin ETF Flows Surge Amid Election Optimism

Donald Trump's victory in the recent presidential election and the promise of more crypto-friendly regulations from a pro-crypto Congress have positively influenced bitcoin prices recently. This optimism was reflected in strong inflows into spot bitcoin exchange-traded funds (ETFs).

After the election results were confirmed, bitcoin ETFs saw $621.9 million in net inflows on Wednesday, according to data from Farside Investors. Nearly half of those inflows went into the Fidelity Wise Origin Bitcoin Fund (FBTC), while BlackRock's iShares Bitcoin Trust (IBIT) experienced its first-ever two-day outflow streak.

Notably, ether (ETHUSD) ETFs also saw their fifth-largest day of inflows on Wednesday, totaling $52.3 million, though this was small compared to the bitcoin ETF flows.