Bitcoin, XRP Prices Rise. 'Extreme Fear' Is Ending.

By Elsa OhlenBitcoin and other cryptocurrencies gained ground early Thursday as U.S. equities rebounded following a selloff Wednesday.The world's largest crypto, Bitcoin, is up 0.8% over the past 24 hours to $84,719, according to CoinDesk data. It dropped Wednesday afternoon, alongside stocks, following remarks by Federal Reserve Chair Jerome Powell at the Economic Club of Chicago.Powell pushed back against the idea that the Fed would intervene in a struggling stock and bond market. His comments indicated that the central bank would continue to hold interest rates at current levels for now.Cryptocurrencies and other assets considered by investors as risky typically gain when interest rates are low, and vice versa.Smaller cryptos followed a similar pattern as Bitcoin. Ripple's XRP rose 1.1% to $2.09 while Ether gained 1.5% and last traded at $1,592.Solana was leading the pack, up 7% over the past 24 hours."In the short term, Bitcoin and crypto are likely to remain correlated with U.S. equities as markets respond to policy volatility, including shifting tariffs," said Dylan Bane at Messari, a crypto data research firm."In the long term, continued tariffs could catalyze structural economic change, leading to a decoupling of Bitcoin from traditional assets as it gains recognition as an independent store of value."FXPro analyst Alex Kuptsikevich is more cautious, noting that the crypto market has yet to move above a so-called resistance line set following President Donald Trump's inauguration on Jan. 20, when Bitcoin traded above $100,000, largely on hope that the new president would boost the crypto sector.Since then, the market has plunged along with stocks in response to Trump's tariffs. The crypto sentiment index is gradually moving out of the "extreme fear" zone and consolidating in the "fear" area, Kuptsikevich says. "This is a good signal that the correction may be over, but there are still not enough catalysts for a full-fledged rally."The S&P 500 and the Nasdaq Composite both rose about 0.2%. Both indexes saw big losses Wednesday.Write to Elsa Ohlen at [email protected] content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.