Bitcoin Showing “Promising Rise Potential” After Fed Rate Decision: Santiment

Santiment – the cryptocurrency markets intelligence platform – has a bullish view of Bitcoin after the Federal Reserve raised its benchmark interest rate by another 25 basis points on Wednesday.

In a follow-up blog post, the company claimed that the top cryptocurrency is showing “some promising upside potential” — particularly as its correlation to stocks continues to weaken.

What’s next for bitcoin?

in its latest versions Insight reportthe company said the initial market reaction to the interest rate decision was one of relief — glad that expected height He was “for”, until the next decision due in June.

Some positive signs include bitcoin up a modest 2% since Wednesday’s FOMC announcement, and increased trading volume across higher cap assets. These large assets also lack “any extreme sell-offs across the board” — not even on Binance Coin, which has been selling off over the past month after the exchange was lawsuit by US regulators.

Moreover, Wednesday recorded the highest trading activity for bitcoin addresses in two weeks, as active addresses surged immediately after the rate hike.

“It was the highest headline activity day in two weeks, and the day that was recorded two weeks ago was mainly due to the significant price drop that traders were reacting to,” Santment explained. “This rally seems to have a lot more to do with the rate hike finally being official, and you can see how it pushed active headlines higher right after the announcement.”

Bitcoin, stocks and gold

While the Fed’s target rate is now moving at 5% – 5.25%, this may not be a problem as Bitcoin’s relationship with stocks – which are highly responsive to central bank activity – continues to fade. As Santiment noted, Bitcoin’s modest reaction on Wednesday was in sharp contrast to its moves after similar price increases throughout 2022, sending Bitcoin and stocks alike to multi-year lows.

“It is important to assess how speculation about how the Fed will decide today may overshadow the actual impact of the expected Fed decision,” Santment added.

Since the collapse of the Silicon Valley bank in May, bitcoin’s correlation with stocks has fallen, while its correlation with gold has risen at the same time. It was both bitcoin and gold quite often comparison As non-sovereign and safe-haven assets, they are immune to the depreciation of fiat currency and protected from the ravages of the modern banking system.