Bitcoin reached a new record high on Thursday, amid increasing speculation that the US Federal Reserve will slash interest rates in September.
The crypto token reached an all-time high of $124,496 early on Thursday morning, surpassing its previous record of $123,193.63 that it hit back in July.
The peak comes on the back of hopes that the Fed will cut interest rates at its next meeting, which may push investors towards riskier assets and reduce the appeal of saving.
Axel Rudolph, analyst at IG, said: ‘If the Fed moves to cut rates in September, it would likely provide another shot in the arm for Bitcoin, reinforcing the risk-on tone that has driven it to recent highs.
The next interest rate decision from the Fed is scheduled for 17 September. Interest rates, currently at 4.5 per cent, are likely to see an aggressive cut from policymakers.
Rudolph added: ‘There’s a very good chance of a 50 basis-point rate cut,’ US Treasury Secretary Scott Bessent told Bloomberg earlier this week.
‘A rate cut would ease borrowing costs, support valuations, and potentially weaken the dollar further, giving an added boost to crypto currencies.
Bitcoin has boomed in 2025, rising some 32 per cent. A year ago, prior to Donald Trump’s election
While much of the optimism is already reflected in the price, the shift in policy could still act as the catalyst for another leg higher.’
The cryptocurrency, the world’s largest by market cap, then fell back to around $118,000. On Friday morning it was trading around $119,000 per token.
The fall back below the $120,000 mark came after Bessent said there were not plans for the US Government to make further Bitcoin purchases for its digital assets reserve.
Bessent told Fox Business on Thursday that the Government wouldn’t buy more of the crypto tokens, instead relying on more than $15billion worth of bitcoin seized from criminals.
He later rowed back, posting on X: ‘In addition, Treasury is committed to exploring budget-neutral pathways to acquire more Bitcoin to expand the reserve, and to execute on the President’s promise to make the United States the “Bitcoin superpower of the world”.’
Bitcoin has boomed in 2025, rising some 32 per cent.
A year ago, prior to Donald Trump’s election, bitcoin was worth less than $60,000 per token.
The token has largely boomed on the back of Trump’s strategic crypto reserve and promises to create pro-crypto regulation.
Last week, Trump passed an executive order allowing cryptocurrency to be included in 401(k) retirement accounts.
The token has also been buoyed by a number of institutional bitcoin purchases in recent months, as companies likes of Gamestop, Tesla, Metaplanet continue to wade in to the crypto space.
Eric Demuth, chief executive of Bitpanda, said: ‘Bitcoin’s recent rise is driven by a combination of favourable macroeconomic conditions, growing institutional interest, clear regulatory frameworks, and a push from the US government.
‘As liquidity returns to the markets, more and more investors are discovering digital assets as a new asset class for their portfolios.
‘We are seeing rising demand in the retail sector, but especially from institutional investors in the US. Everything points to Bitcoin establishing itself as the ‘gold of the digital age.’
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