Bitcoin and Ethereum Rocket Higher: Central Bank Moves Fuel Unstoppable Crypto Rally

Central banks just poured gasoline on the crypto fire. Forget cautious optimism—this is a straight-up market surge, with Bitcoin and Ethereum leading the charge and leaving traditional finance scrambling to catch up.

The Liquidity Liftoff

When central banks shift policy, the smart money moves first. This time, it's flooding into digital assets. It's not about vague 'adoption' narratives anymore; it's about capital seeking the highest, fastest returns in a distorted financial landscape. The old gatekeepers are watching their influence erode in real-time.

Ethereum's Engine Roars

Bitcoin might grab headlines as digital gold, but Ethereum's ecosystem is where the real engine is revving. Its network isn't just holding value—it's executing contracts, settling transactions, and building the backbone of a parallel financial system. While TradFi debates interest rates, DeFi is busy printing them.

A New Market Reality

This isn't a speculative bubble; it's a recalibration. Each cycle washes out the weak hands and strengthens the infrastructure. The institutions that dismissed crypto as a fad five years ago are now the ones quietly accumulating, hoping no one notices they're late to their own party.

The momentum is undeniable. The only question left is how long traditional finance will keep giving itself participation trophies while crypto builds the next generation of capital markets—one skeptical banker at a time.

On Friday, Bitcoin$90,357.50 and Ethereum$3,093.86 experienced a significant rise during Asian trading, crossing critical technical levels and injecting fresh momentum into the cryptocurrency market. This upward trend was influenced by the Bank of Japan’s (BOJ) interest rate hike that the markets absorbed without distress, coupled with U.S. inflation coming in lower than expected, bolstering risk appetite. Bitcoin surged above $87,000, and Ethereum mirrored the general market strength, with numerous altcoins like ADA, SOL, DOGE, BNB, and XRP witnessing intra-day gains of up to 3%.

Macroeconomic Relief Elevates Cryptocurrencies to Key Thresholds

The BOJ raised its policy rate to a three-decade high, a decision that had been anticipated for weeks, alleviating market fears instead of inciting panic. Although Japan’s 10-year treasury yield briefly touched 2% for the first time since 2006, the yen weakened, and Asian equities gained strength. The MSCI Asia Pacific Index ROSE by 0.7%, with technology stocks leading the way.

The recovery in global risk appetite extended to U.S. markets, as the S&P 500 index climbed 0.8%, and the Nasdaq 100 jumped 1.5%. Micron Technology’s positive outlook eased concerns about AI spending and valuation debates. Concurrently, the lower-than-expected U.S. inflation data strengthened the belief that the Fed might start cutting rates in the upcoming months, reinforcing perceptions of a loosening in financial conditions.

Leverage Pressure Persists Amid Year-End Volatility

Before the rally, sessions were volatile yet range-bound, with CoinGlass data indicating that over $576 million was liquidated in the cryptocurrency market within the past 24 hours. A significant portion of these liquidations came from long positions. The current market scenario shows an accumulation of positions during the recent recovery, with high leverage usage aimed at small gains remaining prevalent.

On the blockchain data front, there are signs that selling pressure might ease. According to K33 Research, long-term Bitcoin investors are nearing the end of an extended selling phase, during which approximately 20% of supply has returned to the market over two years. Despite this, the recent surge driven primarily by macroeconomic relief sets the stage for potential volatility as year-end approaches, with liquidity diminishing and leverage levels remaining high.