The bankruptcy filings of Celsius and Voyager have raised questions about what happens to crypto investors when a platform goes down.
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Bitcoin briefly touched $24,000 on Thursday, hitting a key technical level and building on the January rally.
The increase came a day after the Federal Reserve raised its benchmark interest rate by a quarter of a percentage point. But Fed Chairman Jerome Powell noted that the process of disinflation has begun, reassuring investors who bet on falling inflation and forcing them to take on more risk.
Bitcoin last traded about 1% higher at $23,819.26, according to Coin Metrics. The cryptocurrency rose to $24,069.00 earlier in the afternoon after reaching $24,249.70 on Wednesday evening, its highest level since August 17.
“The market took the latest FOMC as dovish, but the bitcoin rally remains shaky,” said Yuya Hasegawa, crypto market analyst at Japanese bitcoin exchange Bitbank. “The price did rally on Wednesday, but failed to close above $24,000 and appears to be losing momentum.”
Hasegawa reiterated the Fed’s warning that while inflation appears to be slowing, it “remains high” and the central bank will need “much more evidence to say with confidence that inflation is approaching the 2% target.”
The jump also coincided with a broader rally in equities, led by the Nasdaq, as well as falls in US Treasury yields and the US dollar currency index ( DXY ), which tend to move inversely to the crypto.
Bitcoin is up more than 40% year-to-date, quickly recouping losses from a disastrous 2022. However, many investors and analysts fear that despite the current bullish trend, crypto is not yet ready for a rocket ship rally, and prices may retreat at least one more time before that happens.
January was the best month for Bitcoin since October 2021 and the best January since 2013.
