Bitcoin Rallies to $85,500 as Fed Holds Rates Steady, Gold Hits New High

Gold continues its record-breaking run, surpassing $3,050 per ounce, while crypto markets post moderate gains following the Federal Reserve’s decision to leave interest rates unchanged at 4.25%-4.50% during Wednesday’s Federal Open Market Committee (FOMC) meeting.

Bitcoin (BTC) climbed 4.5% in the past 24 hours, reaching $85,500—its highest level in nearly two weeks.

The CoinDesk 20 index, which tracks top cryptocurrencies excluding stablecoins, meme coins, and exchange tokens, rose 6%. Ether (ETH) and Solana (SOL) gained 7% each, while Ripple’s XRP jumped 10% after CEO Brad Garlinghouse revealed that the SEC is likely to drop its case against the company.

Crypto-related equities also saw a boost, particularly in the bitcoin mining sector. Shares of Bitdeer (BTDR) surged 10%, potentially driven by advancements in ASIC chip technology and stablecoin giant Tether increasing its ownership stake in the firm to 21%. Core Scientific (CORZ) gained 8%, likely benefiting from the recent IPO filing of AI firm CoreWeave, its largest client. However, despite the daily gains, Bitdeer and Core Scientific remain down 61% and 53%, respectively, from their recent highs.

During his post-meeting remarks, Fed Chair Jerome Powell downplayed concerns over inflation caused by tariffs, calling it a “transitory” issue and noting that recession risks remain low. Stocks initially reacted positively, with the Nasdaq, S&P 500, and Dow Jones all gaining over 1%.

However, some analysts remain cautious. Economist Mohamed A. El-Erian criticized Powell’s use of the term “transitory,” warning on X that past policy missteps should serve as a lesson for the Fed. “With all the current uncertainties, it’s too soon to confidently say tariff-driven inflation will be temporary,” he said.

Gold extended its rally, surging beyond the $3,000 mark earlier this week to a new all-time high of over $3,050. Ritholtz Wealth Management’s chief market strategist Callie Cox noted that while rate cuts remain possible, the Fed appears hesitant to ease financial conditions too soon. “The central bank seems less comfortable with a smooth glide to neutral. It’s possible we’re nearing the end of the soft landing narrative,” she said.