Bitcoin and other cryptocurrencies experienced a significant surge on Thursday, fueled by a newly announced trade deal between the U.S. and the U.K. This rally occurred despite ongoing tensions stemming from President Donald Trump's criticisms of Federal Reserve Chair Jerome Powell regarding interest rate policies. On Thursday morning, New York time, the largest cryptocurrency by market capitalization, Bitcoin, broke through the $100,000 mark for the first time since February. It was recently trading at over $101,289, reflecting a remarkable increase of more than 5% within a 24-hour period, according to data from crypto markets provider CoinGecko.
The Federal Reserve's decision to maintain interest rates at their current level on Wednesday drew sharp criticism from President Trump, who has been vocal about his desire for lower borrowing costs. Trump has been pressuring Powell for weeks, even suggesting he might consider dismissing him. During a speech from the White House's Oval Office, where he announced the trade agreement with Great Britain, Trump took another jab at Powell, stating, "The chairman of the Fed, Jerome, if he would lower interest rates... like numerous other countries, it would be like jet fuel. It would be great." He further quipped, "He doesn't want to do it because he's not in love with me." Earlier in the day, Trump referred to Powell as a "fool" on his Truth Social platform.
Historically, Bitcoin has thrived in low interest rate environments. When rates are low, investors are more inclined to seek out risk-on assets such as stocks and cryptocurrencies. This trend was evident on Thursday, as major equity indexes also saw gains, with both the S&P 500 and Nasdaq climbing over 1%. Investor sentiment was buoyed by hopes of an end to Trump's trade hostilities. In a Thursday press conference, Trump advised investors to "buy stocks now," further indicating his optimistic outlook on the market.
In addition to Bitcoin, other digital assets also saw substantial increases on Thursday. Ethereum, the second-largest cryptocurrency, surged past the $2,053 mark for the first time since early March, registering an impressive gain of over 14% from the previous day's trading. The price of Ethereum recently stabilized around $2,047. Other notable performers included XRP, which rose by more than 6%, and Solana, which experienced a remarkable increase of 10%. In contrast, traditional safe-haven asset gold faced a decline of more than 2% during the same period.
As the cryptocurrency market continues to react to economic developments and political discourse, the bullish momentum for Bitcoin and other digital currencies reflects a complex interplay of investor confidence and macroeconomic factors.
