Crypto market rallies on Fed rate cut optimism; Bitcoin hits record $124,400, Ethereum nears all-time high

Bitcoin (BTC) and the broader cryptocurrency market extended their strong upward momentum on Thursday as a slew of positive developments boosted investors’ appetite for high-risk digital assets. The ongoing rally has been fuelled by multiple factors, including growing optimism for a potential U.S. Federal Reserve rate cut in September, aggressive accumulation by corporate and institutional players, steady inflows into cryptocurrency-focused exchange-traded funds (ETFs), and a surge in bullish activity in the derivatives market, analysts said.

The price of Bitcoin, the largest cryptocurrency, touched a fresh all-time high of $124,400, taking the overall crypto market capitalisation (m-cap) to a record $4.18 trillion. If the momentum continues, analyst expects BTC to cross $140,000 in the coming weeks.

Similarly, Ethereum, the second-largest cryptocurrency by m-cap, surged to $4,786, inching close to its record high of $4,891.70 reached on November 16, 2021.

“Multiple factors, such as strong optimism for a September rate cut, corporate accumulation, consistent ETF inflows, and bullish derivatives activity, have contributed to the rally. Moves by the Trump administration to ease investment in crypto assets have further improved market sentiment,” said Edul Patel, CEO and Co-Founder of Mudrex.

Last week, U.S. President Donald Trump signed an executive order allowing 401(k) investors to access alternative assets, including private equity, real estate, and digital assets, potentially unlocking vast new investment flows.

“Currently trading at $123,600, the breakout has pushed BTC into price discovery, with liquidation clusters forming near $125,500. If the momentum continues, we could see BTC heading towards $140,000 in the coming weeks,” Patel added.

For India, this moment offers a unique opportunity, said Kushal Manupati, Regional Growth & Ops Lead of South Asia at Binance. “Critical Web3 infrastructure is already being shaped by India’s developer community, and as usage grows, there is a huge chance to take the lead in tokenized finance, blockchain innovation, and Web3 legislation. The focus of this story has shifted from price charts to laying the groundwork for an inclusive, open, and global technological future.”

Vikram Subburaj, CEO of Giottus Crypto Platform, said, “Bitcoin pressing into record territory is not an epilogue; it is only a preface. Softer U.S. inflation has tilted the odds toward a September rate cut, and risk assets are responding in unison.”

He sees $120,000 emerging as a sturdy floor and $126,000 as the threshold that could unlock the next surge. For investors, he added, the lesson is twofold: first, that volatility at these heights is not a flaw but the lifeblood of discovery; second, that the discipline to ride both crests and troughs will separate speculative chasing from strategic wealth building.

“We are in an era where every new peak is not the end of the story but an opening chapter. And, crucially, this isn’t a solo act. Ether sits within touching distance of its 2021 peak, and leadership is rotating across quality altcoins. This signals a deepening market rather than a single-asset mania,” he said.

Himanshu Maradiya, Founder & Chairman of CIFDAQ, noted that institutional inflows remain a key driver of the rally, with Bitcoin ETFs attracting over $3.6 billion in fresh investments in the past month. Meanwhile, corporate and sovereign treasuries have significantly increased their holdings, now collectively owning 3.64 million BTC — equivalent to 17% of the total supply.

The market may experience consolidation between $120,000 and $125,000, but strong structural demand and limited supply are likely to support further gains through the end of the year, he added.

(DISCLAIMER: The views and opinions expressed by investment experts on fortuneindia.com are either their own or of their organisations, but not necessarily that of fortuneindia.com and its editorial team. Readers are advised to consult certified experts before taking investment decisions.)