Bitcoin remains a safe place for investors

The most important agenda item of the week and the highly anticipated FED's May meeting decision was announced. According to the decision announced at 21:00 yesterday, the US central bank FED increased the policy rate by 25 basis points to the 5% - 5.25% band, in line with the expectations. With this decision, interest rates in the USA reached the highest level since 2006. The FED, which increased interest rates for 10 consecutive meetings between March 2022 and May 2023, signed the fastest tightening cycle of the last 40 years.

Bitcoin and Ethereum has been affected by FED

While a 25 basis point rate hike decision is expected, some changes in the text of the decision and some statements by FED Chairman Powell came to the fore. Trying to maintain the balance of the hawk and pigeon in the statements, Powell stated that the banking system is solid despite the bankruptcies.

The removal of the phrase “some additional policy tightening may be appropriate” from the text of the decision strengthened the expectations that the FED could end the tightening cycle in the coming period. While the markets welcomed the FED decision, Bitcoin fluctuated in a band of $500 at the time of the decision, keeping its pricing above $28,300. After 22:00 in the evening, after the news that the US-based PacWest bank was also experiencing financial difficulties, demand for Bitcoin came again as the indices were withdrawn. Continuing its pricing just above $29,000 in the morning hours, Bitcoin continues its positive performance amid the fragilities in the financial markets and continues to provide investors with gains and a safe haven in 2023. On the other hand, Ethereum finds buyers in the $1,900 region in the morning.