he Federal Reserve's 50 basis point rate cut on Sept. 18 likely fueled Bitcoin's 3% rise from $59,218 to $62,501. Lower rates reduce yields on traditional assets, driving investors toward alternatives like Bitcoin, and cheaper borrowing encourages speculative investment, boosting its price.

24 hours of Bitcoin pricing from Sept 18

The U.S. Federal Reserve announced its first interest rate cut in four years on Wednesday, opting for a 50 basis point reduction instead of the more widely expected 25 bps cut anticipated a month ago.

Analysts suggest that the rate cut could boost cryptocurrency markets in the long term, though short-term price declines are possible. The Federal Reserve's key lending rate now sits between 4.75% and 5%.

In August, Fed Chair Jerome Powell stated that the "time has come" to cut rates, emphasizing that he does not want to see further cooling in the labor market.

The Fed faced pressure to cut rates more aggressively after the August unemployment report showed the U.S. economy added 142,000 jobs, falling short of analysts' forecasts of 163,000. The jobless rate decreased to 4.2% from 4.3% in July, aligning with predictions, according to data from the Bureau of Labor Statistics.

As of now, Bitcoin is trading just under $62,000. Mason Jappa, CEO and founder of U.S.-based Bitcoin miner Blockware, believes the medium to long-term outlook for cryptocurrency remains "bullish," as lower interest rates typically support risk-on assets like Bitcoin.