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Bitcoin and other cryptocurrencies were lower Thursday after a selloff Wednesday following the latest interest-rates hike from the Federal Reserve. Crypto traders see continued momentum in the digital asset rallybut a pause for now.

The price of Bitcoin has fallen 1.5% in the past 24 hours to $27,700, tumbling from Wednesday highs above $28,500 but rebounding from the trough below $27,000 immediately after the Fed raised interest rates by a quarter of a percentage point. Wednesdays peak marked the highest level for Bitcoin...

Bitcoin and other cryptocurrencies were lower Thursday after a selloff Wednesday following the latest interest-rates hike from the Federal Reserve. Crypto traders see continued momentum in the digital asset rallybut a pause for now.

The price of Bitcoin has fallen 1.5% in the past 24 hours to $27,700, tumbling from Wednesday highs above $28,500 but rebounding from the trough below $27,000 immediately after the Fed raised interest rates by a quarter of a percentage point. Wednesdays peak marked the highest level for Bitcoin since the crypto bear market accelerated last June, with prices for the largest digital asset still up by more than two-thirds in 2023 in a rally that has spurred calls of a new bull market.

Bitcoins rally ahead of the Fed set us up for disappointment, and sure enough we saw Bitcoin retreat from just shy of $29,000 after Powells press conference, said Sam Yilmaz, co-founder of venture fund Bloccelerate. A cooling off period is overdue and allows Bitcoin and crypto to settle I still believe Bitcoin could go to $35,000 in a matter of weeks because, put simply, price action breeds price action in crypto.

Cryptos fell in line with the stock market after the Fed hiked rates, a return to Bitcoins correlation with equities after weeks of outperformance. While the rate hike of 25 basis points was priced in, digital assets dropped in step with the Dow Jones Industrial Average and S&P 500 as investors worried about how tightening financial conditions will continue to pressure the banking system.

Beyond Bitcoin, Ether the second-largest cryptofell 2% to $1,750, but was above late-Wednesday lows. Smaller cryptos or altcoins were more mixed, with Cardano up 1% and Polygon 1% lower. Memecoins were slightly weaker, with Dogecoin and Shiba Inu both down less than 1%.

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Write to Jack Denton at jack.denton@barrons.com

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Bitcoin Edges Lower. Crypto Traders Pause Before Another Rally. - Barron's