Bitcoin rallied sharply on Friday, extending its recent rebound as fears of an imminent US interest rate hike continued to fade.
Positive comments from US regulators also supported sentiment across the cryptocurrency market.
Bitcoin climbed 4.3% to around $81,070 and briefly traded above $82,000 in the previous session, marking its highest level in nearly four months.
Bitcoin Extends Weekly Rally
Bitcoin was on track to gain around 4.3% for the week.
That would mark its third consecutive weekly advance.
The latest rally was driven mainly by falling US Treasury yields and softer expectations for Federal Reserve policy.
Comments from Federal Reserve Governor Christopher Waller helped ease concerns that another interest rate increase could come soon.
Waller Comments Reduce Fed Hike Bets
Waller said he was leaning toward keeping interest rates unchanged when the Federal Reserve meets later this month.
He added that upcoming inflation data would be important, especially if the figures show that price pressures are continuing to ease.
Markets reacted quickly to the remarks.
According to CME FedWatch, the probability of a September rate hike fell to around 50.4%.
That was down from more than 60% earlier in the week.
Lower Yields Support Bitcoin
Falling bond yields generally support risk assets such as Bitcoin.
Because Bitcoin does not generate interest, higher yields can make traditional fixed-income investments more attractive by comparison.
The cryptocurrency remains highly sensitive to changes in interest rate expectations.
A similar rise in Treasury yields had interrupted Bitcoin’s rally in late August.
Crypto Stocks Rally With Bitcoin
Crypto-related stocks also posted strong gains.
Strategy, one of the largest corporate holders of Bitcoin, surged nearly 18% during Thursday’s session.
The move reflected improving sentiment across both cryptocurrency markets and crypto-linked equities.
Markets also benefited from a lack of fresh military escalation between the United States and Iran, which reduced some near-term geopolitical uncertainty.
US Crypto Regulation Boosts Sentiment
Bitcoin also received support from comments by Securities and Exchange Commission Chair Paul Atkins.
Atkins said he expects the Senate to vote on the closely watched Clarity Act on September 15.
He called on lawmakers to approve the legislation and send it to President Donald Trump for signing before the end of the month.
The SEC is also preparing its own crypto-related regulatory framework that could operate alongside the Clarity Act.
Clarity Act Remains Key for Crypto Markets
Crypto investors have closely followed the Clarity Act because it could provide greater regulatory certainty for the industry.
However, the legislation has faced repeated delays in Congress.
Disagreements have centered on issues including stablecoin yield payments and restrictions on cryptocurrency trading by policymakers.
A clearer regulatory framework could improve confidence among institutional investors and financial companies considering greater exposure to digital assets.
Ethereum, XRP and Altcoins Move Higher
The broader cryptocurrency market also rallied on Friday.
Ethereum gained more than 5% to around $2,523 and was on track for a weekly increase of roughly 4.3%.
XRP jumped around 6.6% and was up approximately 7% for the week.
BNB gained 2.5%, bringing its weekly increase to around 5%.
Solana advanced 3.9%, while Cardano outperformed with a gain of about 8%.
Memecoins Join the Crypto Rally
Memecoins also moved higher.
Dogecoin gained around 5.8%, while the TRUMP token advanced approximately 8.1%.
Overall, the crypto market remained supported by falling Treasury yields, reduced Fed rate hike expectations and renewed optimism around US cryptocurrency regulation.
