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Fed Signals Major Bitcoin Shift as Price Struggles Above Highs

Bitcoin's Price Peaks Amid U.S. Treasury Endorsement and Optimistic Market Outlook

  • Bitcoin’s price peaked at $126,000 but retreated in October without surpassing previous highs.
  • U.S. Treasury secretary Scott Bessent publicly endorsed Bitcoin amid a government shutdown.
  • Bessent highlighted bitcoin’s resilience, noting it “never shuts down” and suggested the U.S. might expand its bitcoin reserves.
  • Bitcoin traders view Bessent’s remarks as a signal of continued government interest in bitcoin technology.
  • Market analysts predict bitcoin could reach $140,000 soon, supported by ETF inflows and potential Federal Reserve interest rate cuts.

The Bitcoin Price reached a high of $126,000 but declined in October, failing to break above its previous all-time highs. This occurred alongside signals from the Federal Reserve that could influence the bitcoin market in the near future.

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U.S. Treasury secretary Scott Bessent issued an unexpected endorsement of bitcoin during the ongoing U.S. government shutdown. On the social media platform X, he stated, “17 years after the white paper, the bitcoin network is still operational and more resilient than ever,” adding, “Bitcoin never shuts down,” contrasting it to the government’s gridlock.

Bessent’s remarks revived interest among bitcoin traders, who interpret them as a signal that the U.S. government remains supportive of bitcoin technology. James Lavish, director at Strive, a bitcoin treasury management company, commented on X: “Pay attention to the signals. This is a signal.”

In August, Bessent had caused price fluctuations by suggesting the U.S. government would not purchase additional bitcoin for a federal reserve but later clarified that the Treasury is exploring budget-neutral ways to acquire more bitcoin to expand the reserve. He referred to the bitcoin assets forfeited to the government as the foundation of the strategic bitcoin reserve established by former president Donald Trump.

The bitcoin white paper, authored by the pseudonymous Satoshi Nakamoto and published on October 31, 2008, outlines the bitcoin network’s operation in just nine pages.

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Market analysts remain optimistic about bitcoin’s price trajectory. The crypto exchange Bitfinex stated in an email, “Our base case sees bitcoin rising towards $140,000, with total ETF inflows between $10 and $15 billion not being surprising.” They added that October marked a reset in the bull cycle and suggested that ETF purchases and possible Federal Reserve interest rate cuts could push bitcoin’s value higher in the coming months.

Bitcoin continues to be regarded by most investors as a hedge against currency volatility amid ongoing economic uncertainty.

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