A general resurgence in risk appetite led investors to discount an expanding governmental crackdown, which let Bitcoin restart its drive back toward $30,000 and smaller digital currencies rally.

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The oldest cryptocurrency increased by as much as 5.2%, trading at about $28,812. Before the Federal Reserve raised rates as anticipated on Wednesday, Bitcoin was trading little under $29,000. This year, the token has increased by around 70%, although it hasn't traded at $30,000 since June.

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Que Nguyen, Research Affiliates CIO of Equity Strategies, stated in an interview with Trade Algo, "It's really an asset that trades on sentiment." "One of the things about cryptocurrency that interests me is how little is really done with it. It will be quite significant if anything can be done with it that has an impact on the real economy. Nevertheless, if it isn't, it will be limited to this hobbyist group.

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The Securities and Exchange Commission formally informed Coinbase Worldwide Inc. on Wednesday that it intended to take enforcement action against the biggest cryptocurrency exchange in the US. The SEC filed a lawsuit against cryptocurrency tycoon Justin Sun on Wednesday for allegedly breaking securities laws. Sun claimed that the complaint is unfounded.

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Cardano grew 5.3%, Avalanche increased 6.3%, and Litecoin increased 7.7% among the so-called altcoins. Sun founded the Tron network, and the related token, TRX, increased by roughly 7.8% after falling by 12% on Wednesday.

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Ilan Solot, co-head of digital content at Marex, stated that bitcoin is "essentially following the larger markets, digesting the Fed, and basically pulling down some of the harm that occurred yesterday."

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According to Stephane Ouellette, CEO of institutional cryptocurrency brokerage business FRNT Finance, "the crypto market seems to have held a similar perspective to the bond market going into the Fed conference with an overwhelming likelihood of a 25-bps raise and a minor likelihood of remaining pat."

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The recovery in the cryptocurrency market comes after a general upturn in the equity market, with advances being led by the tech-heavy Nasdaq 100. This index, with which crypto tokens have previously moved in a similar way, is up 17% so far this year, and many analysts still believe the two frequently trade together. Although there was a weaker connection between them at the beginning of the year, it has grown stronger as both have rallied in response to the upheaval in the banking sector.

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Chris Newhouse, a futures trader at the cryptocurrency investment firm GSR, said the move was significant but not over the top. Increased volume in the futures markets and the emergence of more speculative bets are likely to have followed a move under $25,000 or above $30,000, respectively.