Bitcoin recently gained momentum after Federal Reserve Chairman Jerome Powell indicated there would be no more interest rate hikes or tightening of monetary policy for now. This boost in Bitcoin’s strength grew even more after the US non-farm payrolls data seemed to support Powell’s position on rate hikes. When Bitcoin rallies, it often lifts the whole crypto market. This surge can increase trading volumes and attract more investors, giving the entire crypto space a boost. With Bitcoin back in the spotlight, it is important to see how this rebound is impacting other major cryptocurrencies. Let’s delve deeper!
Interest rates and Bitcoin prices are linked because changes in interest rates affect how investors view risk and returns. When central banks like the Federal Reserve increase interest rates, traditional investments like bonds become more attractive, drawing money away from Bitcoin and other cryptocurrencies, which are considered riskier. Conversely, when interest rates are low or stable, Bitcoin can become more appealing to investors seeking higher returns, leading to a price increase.
A boost in Bitcoin’s price can influence other cryptocurrencies. Bitcoin is the most well-known crypto, the top crypto in terms of market cap, and often acts as a market leader. When its price rises, it can create a positive vibe across the crypto market, attracting more investors and boosting confidence in digital assets. This often leads to increased interest in other cryptocurrencies. This effect is known as the “Bitcoin halo,” where a BTC price surge benefits other cryptos.
Let’s see how visible this effect is at this juncture.
Ethereum, BNB, Solana, and XRP are some of the major cryptocurrency apart from Bitcoin.
| Cryptocurrencies | Market Cap |
| Ethereum | $370,043,568,355 |
| BNB | $91,189,712,720 |
| Solana | $69,599,975,643 |
The current price of Ethereum is $3069.2, and the 24-hour trading volume is 7.816M. On May 1, 2024, a day before Powell’s announcement, the volume saw a sharp increase of 30.436M. Similarly, a small increase in the volume, 18.442M, was registered on 6th May. From May 2nd to May 5th, Ethereum saw three consecutive green candles.
The current price of BNB is $588.98. On May 3rd, 2024, BNB saw a long green candle. It took the price from around $559.64 to $586.39. Since then, the price revolves around the peak.
The current price of Solana is $153.08 and its 24-hour volume is 135.679M. On May 1st, it witnessed a sharp volume hike of 207.274M. The same day, it saw a green candle. From that day till today, it has been making consistent green candles, taking the price from $134.64 to $153.08.
The analysis shows that this month the top cryptocurrencies have witnessed some unusual movement in price and volume indices. And, it also indicates the trend continues strongly. It is fair to consider the Bitcoin Rebound as one of the many reasons for the unusual movements witnessed in the top cryptocurrencies.
Also Check Out : Bitcoin Derivatives Traders Bet Big: Predict $100K Surge by September
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