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This Could be Swiftly Igniting a Full-Blown Bullish Craze for Bitcoin, Ethereum, and XRP

Altcoins 2020/03/23 22:52 by Brenda Ngari
Bitcoin's Bullish Cycle Returns In Full Force As Market Pundit Projects $100k Price

Bitcoin has suddenly recovered back above $6,000 after the US Federal Reserve announced that it is planning to further increase liquidity in the markets in a bid to soften the brutal blow of the coronavirus crisis on the US economy.

In particular, the Fed revealed that it will be purchasing assets “in the amounts needed” to ensure the markets are functioning well amid the coronavirus pandemic.

FED Announces Open-Ended Asset Purchases Program

After the coronavirus stimulus bill failed to pass the Senate on Sunday due to a lack of enough votes, most traders expected the correction in the markets to deepen. However, just hours before the US stock market opened, the Federal Reserve announced that it will be buying an unlimited amount of Treasury bonds and mortgage-backed securities to tackle the “severe disruptions” caused by the novel coronavirus.

The Fed said:

“While great uncertainty remains, it has become clear that our economy will face severe disruptions. Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate.”

The Fed will also purchase corporate bonds in both primary and secondary markets as well as via exchange-traded funds (ETFs). The US central bank will also unveil a Main Street Lending Programme soon, to facilitate easy lending to small businesses. 

Additionally, the Fed has launched a new lending program worth $300 billion to “support the flow of credit to employers, consumers, and businesses” affected by the coronavirus-driven economic slowdown.

The Fed had initially announced that it will purchase approximately $200 billion in mortgage-backed securities and $500 billion US Treasuries. This new announcement shows the Federal Reserve’s open-ended commitment to Quantitative Easing (QE).

Bitcoin Surges Past $6,000

US stock futures spiked following this announcement. The S&P 500 futures rallied over 3% to hit 2,370, while the Nasdaq-100 futures surged to 7,240. But, they corrected downwards almost immediately.

Furthermore, the spot markets opened in the negative territory despite the Fed’s announcement. The Dow Jones opened almost 2% lower while the S%P 500 plunged by over 1.5%.

Bitcoin, which has been moving in lockstep with the stock market in recent weeks, also witnessed a pump as the bulls pushed the price to as high as $6,630.99 from $5,780 lows.

However, BTC has since retraced slightly to $6,408.23 at the time of publication. It’s a mixed bag for the rest of the cryptocurrencies. Ethereum is up 5.52% while Ripple’s XRP is up by 3.41%. The biggest gainer among the top 30 most valuable cryptocurrencies appears to be Crypto.com Coin (CRO) which is up 10.54%.

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