• Coinbase shares rose 20% after Federal Reserve’s rate hike and Jerome Powell’s speech.
• Barclays note shows Coinbase volumes increased 56% in January from the previous month.
• Crypto-related stocks, including MicroStrategy and Silvergate Capital, rallied on Thursday.
Coinbase Shares Skyrocket After Fed Rate Hike
Coinbase (COIN) shares soared by more than 20% on Thursday following the Federal Reserve’s latest interest rate hike decision and remarks from Fed Chair Jerome Powell. The U.S.-based crypto exchange also gained a boost after winning a dismissal of a proposed class-action lawsuit by customers claiming Coinbase sold them unregistered securities. This news has pushed Coinbase stock up over 100% this year as the crypto industry is recovering from the FTX exchange collapse.
Barclays Note Shows Increasing Volumes for Coinbase
U.K.-based bank Barclays released a note on Thursday showing that Coinbase volumes rose 56% in January from the previous month, and are now near levels seen before FTX collapsed but remain below average for 2022. Most crypto-linked stocks like MicroStrategy (MSTR) and Silvergate Capital (SI) have also been rising along with broader equity markets.
Crypto Industry Recovers From FTX Collapse
The recent surge indicates that the crypto industry is recovering from its dip caused by the FTX exchange collapse last year. Edward Moya, senior market analyst for foreign exchange market maker Oanda, said: “We might be getting six more weeks of winter, but it doesn’t seem like we will be seeing an ice age in crypto.”
Fed Rate Hike Decision Positive For Crypto Markets
The positive outlook of cryptocurrency markets was further bolstered by Powell’s comments during his speech after the latest rate hike decision, where he noted progress in fighting high inflation rates in the U.S.. This news was welcomed positively among investors as it took some pressure off bitcoin prices which had been suffering due to fears of higher inflation rates leading to higher interest rates – something that could potentially lead to lower demand for cryptocurrencies such as bitcoin since it does not pay any interest income or dividends to its holders compared to other traditional assets like stocks or bonds which do pay out dividends or coupon payments respectively.
Overall, this news is being seen as positive for cryptocurrency markets as it may reduce some of the pressure on bitcoin prices while also increasing investor confidence in cryptos overall due to increasing trading volumes at exchanges like Coinbase and bullish sentiment among equity markets linked to cryptos such as those held by MicroStrategy and Silvergate Capital .