Summary
- Shares of cryptocurrency firms increased as digital assets and major stock indices surged.
- This price increase follows Federal Reserve Chairman Jerome Powell’s indication that interest rates may be cut next month.
- On Friday, Bitcoin and Ethereum also saw gains, with Ethereum and altcoins leading the rise.
Stocks in crypto-focused companies rose on Friday, reflecting the uptrend in digital currencies following a more dovish-than-expected speech from Jerome Powell.
Coinbase (COIN), listed on Nasdaq, surged and was trading over 6% higher at $319. Meanwhile, Bitcoin treasury and software firm MicroStrategy—MSTR—gained nearly 65%, reaching $354. Both stocks had previously been trending downward, but COIN is now showing gains over the past week while MSTR remains slightly down.
Circle, which made its debut on the New York Stock Exchange in May, also experienced a rise, recently priced 6% higher at $140, though it had reached a 9% increase earlier in the day.
Notably, leading Bitcoin miners, CleanSpark (CLSK) and Riot Platforms (RIOT), rose by 5% and nearly 9% respectively, trading around $10 and above $13.
Crypto treasuries such as SharpLink and BitMine Immersion, focusing on Ethereum acquisition, celebrated gains exceeding 12%, reaching nearly $20 and $54.
In general, stocks are showing upward momentum, with The Dow Jones Industrial Average climbing 880 points, or nearly 2%, reaching a new high. The S&P 500 increased by 1.45%, while the Nasdaq rose by 1.6%.
The uptick in equities coincides with a surge in leading cryptocurrencies such as Bitcoin and Ethereum. Bitcoin was recently valued at $116,318, up 3% in the hour after Powell’s remarks, according to CoinGecko data. Ethereum experienced an increase of nearly 8% in that hour, trading at $4,740, about $130 shy of its all-time peak from 2021.
In the last day, Bitcoin and Ethereum posted gains of 3% and almost 12%, respectively.
A potential interest rate cut would likely benefit both cryptocurrency and technology stocks. Historically, these assets perform well in low interest rate settings as investors are attracted to higher-risk assets.
Former U.S. President Donald Trump has been vocal in pressuring Powell to lower rates, often criticizing him on Truth Social and even suggesting repercussions.
The Fed initiated a series of aggressive rate hikes in 2022 to address 40-year high inflation exacerbated by COVID-19. Subsequently, the central bank began to cut borrowing costs last year as the economy began to decelerate.
Daily Debrief Newsletter
Start every day with the top news stories right now, plus original features, a podcast, videos and more.
