On the Chain: Bitcoin rebounds above US$80,000 as traders brace for Fed decision

Bitcoin has climbed back above US$80,000 as cryptocurrency markets recover from a brief sell-off, with traders turning their attention to the US Federal Reserve’s latest interest rate decision.

The world’s largest cryptocurrency was trading around US$80,886 at the latest check, up about 1.6% on the session after moving between US$79,420 and US$81,140.

Bitcoin had slipped below US$80,000 as weakness in artificial intelligence and technology stocks spilled into other risk assets, before buyers returned around the US$79,000-US$80,000 region.

The cryptocurrency remains about 3% lower over the past week and significantly below the US$86,000-US$87,000 levels reached earlier in October.

Fed decision takes centre stage

The immediate focus for crypto markets is the Federal Reserve, with investors looking for guidance on whether another US interest rate increase could follow in December.

Bitcoin has become increasingly sensitive to monetary policy expectations because elevated Treasury yields make government debt more competitive with speculative assets.

A less hawkish message from the Fed could ease pressure on bond yields and the US dollar, potentially supporting Bitcoin and other cryptocurrencies.