Bulls Propel Bitcoin As US Central Bank Considers Lowering Borrowing Costs

The previous week witnessed a somewhat turbulent ride in terms of price movements, as the descent of Bitcoin sent shockwaves throughout the entire market. Currently, the primary cryptocurrency is making an effort to bounce back, and this resurgence has positively affected various altcoins, with many of them showcasing gains in the last 24 hours.

The value of BTC surged to $41.5K, marking a 3.4% increase in the past day. This uptick followed a sudden upward surge when BTC gained over $1,000 in just a couple of hours. The positive momentum propelled the flagship cryptocurrency to $42K, where resistance by bears prevented further advancement.

BTC On The Come Up

This abrupt movement stirred disruptions in the derivatives market, leading to liquidations exceeding $110 million, primarily involving short positions. Market participants are closely monitoring Grayscale outflows, pondering whether investors will offload their long-held BTC now that the spot ETF has become a reality.

Simultaneously, as Bitcoin was on the rise, a majority of large-cap altcoins also experienced positive movements, with some outperforming others. Notably, Solana and Avalanche exhibited stronger recoveries, while Ethereum, Binance Coin, and Ripple also recorded gains.

Manta Network (MANTA) and SATS (Ordinals) emerged as the top performers in a 24 hour period, showing increases of 21% and 18.4%, respectively. Conversely, Chiliz (CHZ) and Klaytn (KLAY) witnessed declines of approximately 4% each. There is speculation about potential interest rate cuts by the Federal Reserve, and investors are closely monitoring the outcomes of the two-day policy meeting this week.

Combating Inflation

As the week unfolds, there is a roughly even chance that the US central bank might consider lowering borrowing costs in March. The European Central Bank (ECB) is also contemplating interest rate cuts this year, with all options open in upcoming meetings, according to Governing Council member Francois Villeroy de Galhau.

Moreover, the ECB believes it is on the right path to combating inflation, citing the deposit rate increase to a record 4% as a significant factor in moderating underlying inflation, as mentioned by the French central banker.