Bitcoin News Today: Crypto Markets Rally on Powell's Dovish Signal as BTC and ETH Surge 5% and 11.51%

The cryptocurrency market swung back into “Greed” territory on Saturday following Federal Reserve Chair Jerome Powell’s remarks at the Jackson Hole Economic Symposium, which signaled potential monetary easing. The Crypto Fear & Greed Index, which had dipped to a “Neutral” reading of 50 on Friday, rose to 60, reflecting renewed optimism among traders [1]. This shift was driven by Powell’s indication that the Fed’s policy stance “may warrant adjusting,” spurring a sharp rally across major digital assets.

Bitcoin responded almost immediately to the dovish tone, climbing nearly 5% to $117,300 and liquidating over $379 million in short positions. Ethereum saw even stronger momentum, surging 11.51% in 24 hours to reclaim its 2021 all-time high of $4,851. The CME FedWatch Tool showed that 75% of market participants now expect a rate cut at the Fed’s September 17 meeting, reinforcing the bullish sentiment across crypto markets [2].

Market participants had been in a defensive posture for over a week, with uncertainty over the Fed’s policy trajectory pushing sentiment into fear territory. However, Powell’s speech reversed this trend, triggering a broad-based rally. Bitcoin rose 3% immediately after the speech, while Ethereum gained 12%, XRP climbed 5%, and Solana surged 8% in the hours that followed [3]. The total market capitalization of cryptocurrencies surpassed $4 trillion within 24 hours, reflecting a significant inflow of liquidity.

The market response underscored the sensitivity of crypto assets to central bank policy. Axie Infinity co-founder Jeffrey Zirlin highlighted Ethereum as the “most rate-sensitive aspect of crypto,” noting that falling interest rates increase the appeal of decentralized finance (DeFi) yields over traditional banking returns [4]. Similarly, investment advisor Jessy Gilger observed that dovish Fed policy “supercharges BTC’s narrative as a hedge against fiat uncertainty,” accelerating institutional accumulation and liquidity flows [5].

The rally also coincided with growing institutional interest in Bitcoin. Reports indicated that fifteen U.S. states are advancing plans for Bitcoin reserves following President Trump’s executive order on a potential national cryptocurrency stockpile, adding further support to BTC’s price action [6]. This institutional buildup, combined with the anticipation of rate cuts, contributed to a synchronized positive response across both crypto and traditional markets.

Despite the optimism, some analysts cautioned that volatility remains a risk if the Fed diverges from market expectations. While 75% of participants anticipate a September rate cut, 26% still see a possibility of no cut, maintaining an element of uncertainty around the policy outlook [7]. Nevertheless, the immediate post-speech rally suggests that many investors are already pricing in an accommodative Fed stance, and further gains could be on the horizon if the central bank follows through.

As the market consolidates its gains, all eyes remain on the September Fed meeting. The interplay between macroeconomic policy and crypto markets continues to highlight the growing integration of digital assets into broader financial systems, with Fed communications playing a pivotal role in shaping investor behavior and asset allocation.

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Source: [1] Coinpedia (https://coinpedia.org/news/crypto-fear-and-greed-index-surges-as-powell-speech-sparks-bullish-wave/)

[2] BanklessTimes (https://www.banklesstimes.com/articles/2025/08/22/crypto-bull-run-why-are-altcoins-like-arbitrum-ethena-eth-going-up/)

[3] CoinStats (https://coinstats.app/news/af856ab5efbdae3ba9265a21f4fb024a1148337f638f64fbee8a4d230877eda7_Ether-Likely-to-Top-5K-BTC-Eyes-Record-High-as-Powell-Sparks-Rally-Watch-for-DAT-Deal-Risks-Asset-Managers)

[4] CoinMarketCap (https://coinmarketcap.com/community/articles/68a9ad2c591a840d675646b8/)

[5] FXStreet (https://www.fxstreet.com/)

[7] AInvest (https://www.ainvest.com/news/bitcoin-news-today-investor-fear-fed-uncertainty-spark-crypto-exodus-jackson-hole-2508/)