Bitcoin Hits Two-Week Highs Amid Anticipation of U.S. Crypto Policy Update

Bitcoin (BTC) surged to its highest level in two weeks on March 20, driven by speculation that the U.S. government would soon announce a major change to its cryptocurrency policy.

Federal Reserve's Stance Boosts Market Confidence

Data indicates that BTC/USD reached nearly $87,500 on Bitstamp before settling around $86,000. This rise came following a relatively calm meeting of the Federal Reserve, during which officials decided to maintain current interest rates.

Fed Chair Jerome Powell explained that inflation has "eased significantly," allowing the Fed to take a cautious approach to monetary policy. He mentioned, "We do not need to be in a hurry to adjust our policy stance, and we are well positioned to wait for greater clarity." This relaxed attitude helped lift the spirits of troubled risk assets, with Bitcoin and U.S. stocks experiencing notable gains. The S&P 500 closed up about 1% on March 20, adding $500 billion to its market capitalization.

Arthur Hayes, the former CEO of the crypto exchange BitMEX, commented that the Fed has signaled a favorable environment for traders willing to take on more risk. He referenced the impending end of quantitative tightening and the potential for new rounds of quantitative easing.

Speculation Around U.S. Crypto Announcement

Despite Bitcoin's recent gains, traders were particularly focused on the anticipation of a potential announcement regarding U.S. cryptocurrency policy. Whispers circulated that a significant update could come as soon as March 21.

The Kobeissi Letter noted that this announcement would represent the first major update since the establishment of a national crypto reserve on March 6, which raised speculation that President Trump might alter his strategy regarding cryptocurrencies.

When Trump previously signed an executive order to create a Strategic Bitcoin Reserve, markets remained relatively calm despite not indicating that the U.S. would purchase BTC outright. However, with Bitcoin's daily close surpassing key resistance levels, optimism was beginning to resurface.

Notably, one analyst observed that Bitcoin only requires an additional 8% rally to reclaim higher price ranges and overcome recent downside pressures. This follows a significant 13% increase from last week’s lows.

This article does not offer investment advice. Readers are encouraged to conduct their own research when making any investment decisions.

Bitcoin, US, Crypto