Bitcoin jumps to $61,000, then pulls back after Fed rate cuts

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Bitcoin and the S&P500 both rose following the Fed's rate cut. The crypto market price has increased by more than 3 percent in the last 24 hours.

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Bitcoin (BTC) experienced a sudden surge, after the Federal Reserve (Fed) cut US interest rates by 0.5%, nearing $61,000 for the first time in 4 years. However, it quickly trimmed its gains amid volatile trading.

Bitcoin is now trading around $60,500, up 1.5% in the last hour, according to data from CoinGecko. As the crypto market awaited the Fed's interest rate decision and its implications for the economy, the largest crypto asset was marginally lower at the Wall Street open today.

Ethereum (ETH) rose 1% to around $2,300 following the price cut announcement. Other major crypto assets including Binance Coin (BNB), Solana (SOL), Ripple (XRP) and Toncoin (TON) followed by posting sudden gains.

Historical data shows that Bitcoin fell 30% after the Fed announced a rate cut in March 2020. But prices started to rally towards the end of the year. At the end of 2020, BTC hit a record high of $61,300.

The price cut decision comes as a big boost to the crypto market, which has been struggling with volatility and bearish sentiment in recent months. Low interest rates reduce the risk of holding risky assets such as crypto assets, making them more attractive to investors.

It also suggests that Fed action could ease economic conditions, which would benefit the broader financial market and indirectly support the crypto sector.

However, the drastic slowdown could be seen as a reaction to weakening economic conditions, which could lead to a short-term lag in crypto prices.

The market value of the crypto currently stands at 2.15 trillion dollars, which has decreased by 3% in the last 24 hours.

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