- Bitcoin reached a record high above $124,000 as investors expect a U.S. interest rate cut in September.
- Market analysts point to strong buying activity and supportive policies from the Trump administration as driving factors.
- Ethereum and XRP also saw price increases amid positive regulatory developments.
- Experts warn that the market may be too confident about upcoming changes in Federal Reserve policy.
- Recent regulatory clarity, including SEC decisions, has increased investor confidence across several cryptocurrencies.
On Wednesday, Bitcoin surged past $124,000, reaching a new all-time high, as traders grew more certain about a U.S. Federal Reserve interest rate cut expected in September. The probability of a rate reduction climbed above 90%, fueling a strong move into cryptocurrencies and other risk assets.
Bitcoin climbed 3.6% over the past 24 hours, trading near $123,500 after briefly touching $124,128 according to CoinGecko data. Analysts cite a combination of high liquidity and investor optimism for the sustained rise. Pav Hundal, an analyst at Swyftx, noted that liquidity is currently flowing into risk assets and that “funding rates are well within normal ranges,” showing no signal of overheating.
With most investors betting on lower interest rates, asset prices are rising as they seek higher returns. David Lawant, head of research at FalconX, explained: “When Bitcoin enters price discovery, I focus on orderbook dynamics… So far, conditions look exceptionally strong.” Lawant said Bitcoin has remained near its highs for weeks despite significant selling pressure, which may lead to more gains once that pressure is relieved.
Analysts also attribute renewed buying interest to recent regulatory moves. The current administration under President Donald Trump has promoted crypto-friendly policies, boosting market confidence. For Ethereum, Sean Dawson from Derive highlighted that “Digital Asset Treasuries” are driving demand, as these products offer staking rewards that exchange-traded funds (ETFs) cannot. The U.S. Securities and Exchange Commission (SEC) also recently exempted self-custodial staking from securities laws.
XRP’s rise is linked to increased regulatory clarity following the resolution of the SEC v. Ripple case, according to Ryan Lee at Bitget research. Lee expects XRP prices could approach $9 by 2026 if adoption continues.
However, Hundal warned that the market may be overconfident about a September Fed rate cut. He noted, “Despite the fact that core CPI ticked up slightly, we don’t know what the full impact of tariffs is going to be. It feels like we’re priced for perfection, and that makes me nervous.” Some analysts advise caution, reminding investors that policy changes are not guaranteed and market conditions could shift quickly.
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