Bitcoin (BTC) hit two-week highs. This surge was largely fueled by speculation that the US government was preparing to rollout a comprehensive pro-crypto framework. The market's positive reaction stemmed from signals that policymakers are considering two rate cuts by the end of 2025. Bitcoin continued to ride the wave from a relatively dovish Federal Reserve meeting the day before.
According to data from Cointelegraph Markets Pro and TradingView, BTC/USD hit just under $67,500 on Bitstamp. Oh, and traders seemed more focused on an emerging optimistic trend where the US loosens its anti-crypto regulatory stance. Spy reports hinted that an announcement about implementing this policy update was forthcoming and would be made on March 21.
Market Optimism and Policy Expectations
Speculation ran wild at the time due to the revaluation of Bitcoin. Most think this recent enthusiasm is coming from hopes of a more favorable regulatory climate for crypto in the US. We don’t know what concrete proposals are in store, but last March former President Trump signed an executive order to establish a Strategic Bitcoin Reserve. Given all this bad news, markets have been amazingly calm. The strategy — which wouldn’t require the US government to directly buy BTC — did not lead to instant market shaking panic.
The Kobeissi Letter summarized the topic in an X post.
Bitcoin only needs to rally an additional +8% to position itself for a reclaim of the Range above and end this downside deviation. - Rekt Capital
Rekt Capital reported on the topic as well.
Federal Reserve's Influence
Bitcoin’s leap was likely aided by recent Fed meeting news signaling possible future rate cuts. Just today, Fed Chair Jerome Powell went so far as to say that inflation had “eased considerably.”
We do not need to be in a hurry to adjust our policy stance, and we are well positioned to wait for greater clarity. - Jerome Powell
As Arthur Hayes put it, the Fed just dropped the most important signal ever for risk-additional traders.
JAYPOW delivered, QT basically over Apr 1. The next thing we need to get bulled up for realz is either SLR exemption and or a restart of QE. - Arthur Hayes
Anticipated Policy Announcement
The market's attention is now fixed on the anticipated announcement regarding the US government's crypto policy. The expectation is that this update could provide greater clarity and potentially foster a more innovation-friendly environment for digital assets. Traders are understandably euphoric over the announcement. They think it might just bring the kind of long overdue regulatory shift that the landscape needs.
