US Bitcoin Demand Surged After Speech by Federal Reserve Chair | Bitcoinist.com
The price of Bitcoin experienced an early weekend surge following Federal Reserve Chairman Jerome Powell’s speech at the Jackson Hole symposium. According to the latest on-chain observation, the announcement of potential interest rate cuts has led to an increase in Bitcoin demand in the past day.
BTC Demand Sees Growth In The US — Impact On Price?
In a recent post on the X platform, CryptoQuant’s Head of Research Julio Moreno revealed that demand for Bitcoin has been on the rise in the United States in the past 24 hours. This growth came on the back of the Fed disclosing that a cycle of lower interest rates would soon commence.
Lower interest rates by the central bank are often a welcome development for risky assets like Bitcoin, the world’s largest cryptocurrency. Falling interest rates tend to diminish the profits on traditional financial instruments such as bonds, making cryptocurrencies more attractive options for investors seeking higher yields.
According to Moreno, the BTC price premium on Coinbase — the largest cryptocurrency exchange in the US — has surged to its highest level since mid-July. For context, the Coinbase premium refers to the difference between the coin’s value on Coinbase and other global centralized exchanges.
Chart showing BTC’s Coinbase premium index | Source: jjcmoreno/X
Typically, when the BTC price premium on Coinbase is rising, it implies that there is increasing demand from US investors, as they are willing to spend more to acquire Bitcoin. As earlier explained, this heightened demand makes sense given the likelihood of interest rate cuts and less profitable traditional financial instruments.
Increasing demand is a particularly good sign for the price of Bitcoin, as it suggests that investors are positioning themselves to reap from a promising crypto future. At the same time, the growing demand and the rising price premium could result in elevated market volatility.
Furthermore, the increasing US Bitcoin demand comes just at the right time, as demand growth has remained at low levels over the past few weeks. CryptoQuant observed in a report that BTC’s apparent demand has been sluggish since April 2024 when the coin’s price was around $70,000.
According to the blockchain intelligence firm, the apparent demand needs to see some growth for BTC’s price to see some daylight. Ultimately, if the growing demand in the United States is sustained and spread to other markets, investors could see the flagship cryptocurrency return to around its all-time high.
Bitcoin Price At A Glance
As of this writing, the price of BTC is hovering around $64,000, reflecting an over 5% increase in the past day. According to data from CoinGecko, the premier cryptocurrency is up by 7.5% in the past week.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from iStock, chart from TradingView
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