Bitcoin price almost touched $ 40,000, what is the cause?

This growth is said to be the result of a three-day closed-door meeting of the US Federal Reserve (FED). Accordingly, the Fed announced an increase in interest rates by 0.5 percentage points – the highest rate increase in the past 22 years. After the announcement of the Fed’s interest rate increase, the price Bitcoin reversed to increase sharply after a correction day due to bad news.

Recorded on May 5, Bitcoin almost hit the $40,000 mark, up 4.5% from the previous day. The total market capitalization of Bitcoin also increased again and reached the $ 750 billion mark.

Bitcoin Price Rises Close to $40,000 After Fed Announcement coinmarketcap

Bitcoin price increases, a series of large-cap cryptocurrencies are also “green”. Recorded from the data of CoinMarketCap May 5, Ethereum, the cryptocurrency right behind Bitcoin, is up 5% since May 4 with prices hovering around $2,950. Other coins such as Polkadot (DOT), Carnado (ADA), Avalanche (AVAX) or Solana (SOL) all increased sharply by 10-20%.

Besides Bitcoin, coins like Ethereum, Solana, Carnado… also surged coinmarketcap

The fact that Fed Chairman Jerome Powell ruled out a 75 point (0.75%) increase in interest rates has supported Bitcoin’s bullish momentum. “A 75-point increase is not something we’re looking at. I would expect to see inflation flat,” Mr. Powell said after the meeting.

Talking to CNBC, Nick Mancini, research director at the cryptocurrency sentiment analysis platform Trade The Chain, said that any news from the Fed, except for a rate hike of more than 0.75%, will stimulate love the growth for stock price and electronic money. “The market will appreciate 0.25 – 0.5% from here to the end of the year. This provides certainty, favoring the uptrend,” Mr. Mancini predicted.

Besides the announcement of the Fed’s interest rate hike, experts say that the event of two big banks in Argentina allowing trading of crypto assets on their platform also contributed significantly to the sudden growth of Bitcoin and other cryptocurrencies.

In addition, in a recent filing with the US Securities and Exchange Commission (SEC), Tesla once again stated in favor of Bitcoin, and stated that Bitcoin has the potential and can replace liquidity for money. face. Not long ago, Tesla publicly announced its partnership with Block and BlockSteam to Bitcoin mining with solar energy. It is these moves by Tesla that have fueled the recent Bitcoin price increase.