Bitcoin Shows Signs of Strength After Fed’s Latest Rate Hike
Crypto analytics firm Santiment has expressed a bullish outlook on Bitcoin following the Federal Reserve’s 25 basis point rate hike on Wednesday. Despite tighter monetary policy, the firm believes Bitcoin may be poised for growth — particularly as its correlation to equities continues to weaken.
In its latest market insight, Santiment noted that the initial market reaction to the Federal Reserve’s decision was one of relief. Bitcoin rose by about 2% after the announcement, and trading volumes across top assets also saw an uptick.
The firm highlighted that the day following the rate hike recorded the highest Bitcoin address activity in two weeks. Unlike previous spikes linked to price drops, this surge appeared to be driven by market optimism over the Fed’s predictable decision.
Bitcoin’s Relationship With Equities and Gold
With the Federal Reserve’s benchmark rate now between 5% and 5.25%, many investors expected heightened volatility. However, Bitcoin’s reaction was muted compared to its sharp drops during similar hikes in 2022.
Santiment pointed out that Bitcoin’s correlation with equities — traditionally sensitive to rate changes — has fallen significantly since the collapse of Silicon Valley Bank. At the same time, Bitcoin’s correlation with gold has increased, reinforcing its reputation as a digital safe haven.
Both assets are viewed as stores of value independent of government control and resilient to fiat currency risks. The shift suggests that Bitcoin is increasingly being treated like gold, particularly during financial uncertainty.
As the market looks ahead to the next FOMC meeting in June, Santiment’s data indicates that Bitcoin’s fundamentals remain strong, supported by growing network activity and reduced speculative short positions.
