Bitcoin and Ethereum finished a volatile week firmly higher, staging sharp rebounds on Sept 18 as investors moved past a US regulatory setback and the Federal Reserve’s (Fed) first interest-rate increase in more than three years.
Bitcoin ended Sept 18 at about US$80,882, up 5.81% on the day and around 4.7% from the previous close of US$77,220.50 on Sept 11. From its Sept 14 close of US$78,185.30, the cryptocurrency gained about 3.4%.
Ethereum, meanwhile, closed at about US$2,611.68, surging 6.71% on Sept 18 and gaining roughly 3.8% over the week from its Sept 11 level.
The week was far from smooth.
Bitcoin initially advanced 1.75% on Sept 14 before tumbling 3.28% the next day, while Ethereum slid 4.63%, after the US Senate failed to advance the Clarity Act, legislation intended to establish a comprehensive regulatory framework for digital assets.
Bitcoin fell more than 5% at one stage as the legislation appeared set to fail, while crypto-linked stocks also came under pressure.
Attention then shifted to monetary policy.
The Fed raised its benchmark interest rate by 25 basis points to 3.75%-4% on Sept 16 and signalled further tightening could follow as policymakers sought to contain inflation fuelled partly by elevated oil prices. Higher interest rates and Treasury yields typically weigh on speculative and risk-sensitive assets, including cryptocurrencies.
Crypto markets nevertheless stabilised after the Fed decision before breaking sharply higher on Sept 18.
Bitcoin jumped 5.81% to regain the US$80,000 level, while Ethereum rallied 6.71%, as investors appeared to conclude that much of the week’s regulatory and monetary-policy risk had already been priced in.
The rebound spilled into US-listed crypto stocks, with Coinbase, Strategy and Robinhood gaining between 9.1% and 16.4% on Sept 18 as Bitcoin surged.
Despite persistent concerns over high Treasury yields, inflation and further Fed tightening, the late-week recovery left both Bitcoin and Ethereum comfortably higher for the Sept 14-18 period.
