Investing.com — Bitcoin prices rose on Tuesday, tracking broader gains in risk-driven markets amid growing bets that the Federal Reserve will begin cutting interest rates in September.
The index was up 4.5% at $61,176.1 as of 01:29 ET (05:29 GMT).
Selling pressure from concerns over token distributions by defunct cryptocurrency exchange Mt Gox also appeared to have dissipated, while data on Monday showed that cryptocurrency investment products saw some positive capital flows over the past week.
But despite the recent gains, Bitcoin still remained close to a trading range seen for most of the year, while the token struggled to reach new highs as interest in cryptocurrencies waned.
Bitcoin boosted by rate cut bets, Powell in focus
Bitcoin and other cryptocurrency markets rose in tandem with a broader risk-on move in global markets, which saw Wall Street indexes post strong gains on Monday.
Risk sentiment improved amid growing conviction that the Fed will cut rates in September, with traders positioning for a 25 basis point reduction.
In that regard, the focus this week is on a speech he will deliver on Friday at the Jackson Hole Symposium. While the Fed chair is unlikely to explicitly outline his plans for cutting rates, he is expected to offer more encouraging comments, especially as recent data showed some cooling in US inflation.
Lower rates bode well for speculative and risky assets such as cryptocurrencies.
Yen appreciation poses some risks
But a sharp appreciation this week presented some risks for cryptocurrencies, especially after a similar trend decimated cryptocurrency prices in early August.
Relatively lower interest rates in Japan make the yen a popular vehicle for speculative trading, and cryptocurrencies are a major destination for these transactions. But this carry trade was largely offset by a sharp appreciation of the yen in early August, following hawkish signals from the Bank of Japan.
While the yen had fallen over the past week, it appreciated strongly again on Monday, presenting potential headwinds for risk-driven markets.
Cryptocurrency prices today: altcoins advance in tandem with Bitcoin
Cryptocurrency prices across the board advanced on Tuesday, with the world's No. 2 token up 2.2% to $2,681.48.
Shares of Mango Markers, once the largest decentralized exchange on the Solana blockchain, were preparing to settle with the Securities and Exchange Commission over several securities law violations.
Other altcoins also rose, with , and increasing between 3% and 7%.
Among meme tokens, it rose by 4.7%.
