Bitcoin Reclaims $61K as Fed Signals Ease Inflation Concerns

Bitcoin rebounded strongly on Thursday, climbing above $61,000 after recovering from an earlier slide that pushed the cryptocurrency to around $58,200. According to CoinDesk data, Bitcoin gained roughly 4.1% over the past 24 hours, marking its strongest performance of the week as investors responded positively to a shift in U.S. Federal Reserve commentary.

The rally followed remarks by Federal Reserve Chair Kevin Warsh during the European Central Bank's annual forum in Sintra, Portugal. Warsh said inflation risks had eased, a notable change in tone after his more hawkish outlook in June contributed to persistent selling pressure and weeks of outflows from U.S. spot Bitcoin exchange-traded funds (ETFs). The comments renewed expectations that the Fed may eventually adopt a less restrictive monetary policy if inflation continues to cool.

Bitcoin’s recovery was particularly notable because it came during a difficult session for global technology stocks. South Korea’s Kospi index dropped 7.9% after semiconductor giants Samsung Electronics and SK Hynix lost a combined $290 billion in market value. The decline reflected renewed concerns about slowing demand for artificial intelligence chips and the sustainability of massive AI-related investments.

Investor caution also increased after Meta announced plans to offer excess computing capacity to external customers, raising fresh questions about whether the rapid expansion of AI infrastructure has outpaced actual market demand. Those concerns weighed heavily on technology shares but had little impact on the cryptocurrency market.

Bitcoin’s ability to outperform during a broad technology sell-off highlighted a shift in market sentiment. Over recent months, capital had largely rotated away from cryptocurrencies and into AI-related stocks. Thursday’s rebound suggested that digital assets may be regaining investor attention, especially as expectations for future interest rate cuts strengthen.

Earlier this week, FxPro Chief Market Analyst Alex Kuptsikevich warned that Bitcoin remained in a fragile technical position while trading below $60,000. He noted that if support failed, the next major downside target could be near $40,000. Bitcoin’s move back above $61,000 has eased immediate bearish pressure, although analysts caution that one strong trading session does not reverse the weakness seen throughout the first half of the year.

Market participants are now turning their attention to Friday’s closely watched U.S. nonfarm payrolls report. A stronger-than-expected jobs report could reinforce the Federal Reserve’s case for maintaining higher interest rates for longer, potentially limiting further gains in Bitcoin and other risk assets. Conversely, weaker labor market data could strengthen expectations for future rate cuts, providing additional support for cryptocurrency prices.

With macroeconomic data once again driving investor sentiment, Bitcoin’s next major move is likely to depend on how the labor market influences the Federal Reserve’s policy outlook and broader risk appetite across global financial markets.