Crypto rallies through the Fed’s first rate increase since 2023

BTC$76,320.08
pushed up to $76,621 on Thursday, a gain of 0.60% since midnight UTC and 0.88% over 24 hours, as risk assets focused on the Federal Reserve’s interest-rate projections rather than the first increase in more than three years. Ether ETH$2,432.06 added 1.1% to $2,444.36 and solana (SOL) rose 2% to $100.57.

The Federal Open Market Committee voted to lift the target rate by 25 basis points to 3.75%-4%. Chair Kevin Warsh told reporters that inflation had been “too high … for too long” and that recent months’ readings did not suggest underlying trends had meaningfully improved.

What reassured traders was the committee’s “dot plot” forecast, with a median policy rate of 4.1% at the end of both 2026 and 2027, implying just one further 25 basis-point move and no sustained tightening cycle.

Risk assets rallied, with the Dollar Index losing 0.17% while Nasdaq 100 index futures gained 1.04%, S&P 500 futures 0.81%, gold 1.02% and silver 1.52%. The two-year Treasury yield slipped 2 basis points to 4.71% after touching the highest level since 2024 in the previous session.

Crypto joined the move rather than led it, a change from earlier in the week, when the asset class traded independently of equities. The sector’s recovery is broad-based, but more pronounced at the speculative end, with 94 of the CoinDesk 100 constituents higher over 24 hours and the small-cap CoinDesk 80 advancing 4.7% compared with 1.2% for the bitcoin-heavy CoinDesk 5.

Fund flows have yet to turn, however. U.S. spot bitcoin ETFs shed $295.98 million on Wednesday after losing $450.33 million the day before taking the running total since Sept. 8 to more than $1 billion across seven sessions and total net assets down to $95.19 billion

Bitcoin remains 6.9% below the $82,284 monthly high it set on Sept. 4.

Derivatives positioning

• Aggregate open interest across crypto futuresclimbed to $64.4 billion from $59.7 billion on Monday, on $112.6 billion of 24-hour volume, with $214.3 million liquidated over the past day, according to Coinalyze. The movements imply traders have been adding exposure into the rally rather than covering short positions.
• Bitcoin open interest rose 1.41%to $26.6 billion and ether open interest added 1.39% to $16.7 billion. Ether accounted for $60.7 million of liquidations against bitcoin’s $42.4 million.
• Zcash (ZEC) tells the most compelling story, with open interest climbing 37.84% to $2.2 billion over 24 hours, $28.9 million liquidated and the funding rate at -0.0253%, meaning shorts were paying longs even as the token set new highs. Traders have spent the month trading against this rally and being constantly squeezed as a result.
• Bitcoin funding is positive and rising, with the aggregated rate at 0.0070% and the predicted rate at 0.0082%, though the spread across venues is wide, from Kraken at 0.0153% to Huobi at -0.0003%.
• Coinalyze’s long/short ratiois showing a skew towards bullish traders, with a ratio of 1.13. It has now been positive for eight straight days after a three-week period in the negative.

Source: cryptonews.net