Bitcoin has shed its early week gains, despite the Federal Reserve signaling it will pause its interest rate hikes.
On Wednesday, the Fed announced it would pause on its 18 month campaign of interest rate hikes. At the Federal Reserve Open Market Committee (FOMC) meeting in Washington DC, the central bank said it would keep the federal funds rate at a range of 5.25% to 5.50%. This is the second pause since the Fed started increasing rates back in March 2022.
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The announcement did little to bolster risk assets like bitcoin (BTC-USD). The world's largest digital asset by market capitalisation has fallen 0.5% in the past 24 hours to a current price of $26,978, according to CoinGecko data.
Bitcoin showed its tendency to march in lockstep with equities. The tech-heavy Nasdaq Composite (^IXIC) fell almost 1.5% during trading on Wednesday. Global stocks tumbled and US Treasury yields shot up after Fed Chair Jerome Powell dashed hopes of a rate hike reversal by suggesting there could be a much tighter monetary policy through 2024 than previously expected. The rate-setting FOMC said "inflation remains elevated" and Powell reiterated that the Fed's job is to lower it.
However, Powell reiterated the primary objective of the Fed's monetary policy was a soft landing. The central bank will strive to execute its tightening campaign without triggering a widespread economic downturn. "That's what we've been trying to achieve for all this time," Powell said during Wednesday's Fed policy press conference.
Japan's Nomura bank launches bitcoin fund
The monetary policy update came after an announcement from Laser Digital Asset Management, a subsidiary of Japan's Nomura bank, that it is introducing a Bitcoin Adoption Fund.
The aim of the fund is to provide institutional investors with a streamlined and efficient entry point into the rapidly evolving digital assets space.
This fund positions itself as a cost-effective and secure investment option for gaining exposure to the digital asset.
Laser Digital Asset Management has expressed its intentions to roll out a broader suite of digital adoption investment tools in the near future.
"Technology is a key driver of global economic growth and is transforming a large part of the economy from analogue to digital,” Head of Laser Digital Asset Management Sebastien Guglietta said in a press release. “Bitcoin is one of the enablers of this long-lasting transformational change,” he added.
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