Bitcoin Surges After Fed Chair Jerome Powell’s Remarks
On January 29, the Federal Reserve (Fed) announced that it will maintain interest rates at 4.25–4.5%, as expected by market analysts. While this decision was not a major surprise for Bitcoin, Powell’s comments proved to be a key factor influencing crypto markets.
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During the Federal Open Market Committee (FOMC) announcement, Bitcoin, as usual, experienced turbulence, reacting to both the rate decision and Powell’s statements. The Fed reaffirmed its commitment to maximizing employment and achieving long-term inflation at 2%.
“The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid. Inflation remains somewhat elevated,” stated the FOMC press release.
Federal Reserve Chair Jerome Powell held a press conference closely watched by crypto traders and investors, as his remarks often signal potential shifts in monetary policy and the Fed’s stance on key economic issues.
One of the biggest surprises came when Powell responded to a question about the crypto industry. He clarified that the Fed’s role in cryptocurrency is primarily focused on banking oversight, emphasizing that banks are still allowed to serve crypto-related clients. He also added that the Federal Reserve is not opposed to innovation.
During Powell’s press conference, Bitcoin surged from $101,500 to over $104,500, before undergoing a slight correction.
The crypto industry’s relationship with banks remains a critical issue. Recently, the SEC, under its new leadership, repealed the controversial SAB 121 rule, which previously required financial institutions to classify crypto holdings as liabilities on their balance sheets.
This rule had complicated crypto custody services for banks, so its repeal is widely viewed as a positive development for the industry.
Related: Trump Media Reveals Truth.Fi, Plans Crypto Portfolio Expansion
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