Bitcoin (BTC) rose nearly 3% in the past 24 hours, making a strong recovery after a sharp 8% drop earlier this week. The surge occurred as the U.S. Federal Open Market Committee (FOMC) wrapped up its meeting, deciding to keep interest rates unchanged. This decision boosted investor sentiment, propelling both stock and crypto markets higher, with Bitcoin trading near $105,000 during European morning hours on Thursday.

Led by Jerome Powell, the FOMC maintained the policy rate at 4.25-4.50%, marking the first rate decision under the Trump administration after three consecutive rate cuts in 2024. Powell indicated that there was no rush to change the policy stance, citing the need for further progress on inflation.

In general, higher interest rates can make traditional investments more attractive, which may lower demand for Bitcoin. However, when rates remain steady or decrease, Bitcoin becomes more appealing as alternative investments lose their allure. In particular, higher rates can boost the value of the dollar, which could negatively affect Bitcoin’s price, while lower rates can have the opposite impact.

Bitcoin’s 3% gain in the past day helped to recover all the losses from Monday’s dramatic sell-off, which had been triggered by mass liquidations. Other cryptocurrencies followed suit, with Cardano (ADA), Dogecoin (DOGE), XRP (XRP), and Ether (ETH) seeing similar gains of up to 3%. Solana (SOL) outperformed the broader market, adding 4%, and the CoinDesk 20 index gained 2.8%.

Meanwhile, Litecoin (LTC) posted a 14% surge after the U.S. Securities and Exchange Commission (SEC) acknowledged a filing from Canary Capital for a spot Litecoin ETF. This marks the first time an altcoin has been recognized by the SEC in this manner, following a pattern of previous altcoin ETF applications being rejected. The filing is now under review, and the SEC has started a 240-day public comment period before making a final decision.