The Fed announced it would pause on its 18 month campaign of interest rate hikes

Bitcoin has shed its early week gains, despite the Federal Reserve indicating it will pause its interest rate hikes.

On Wednesday, the Fed announced it would pause on its 18 month campaign of interest rate hikes. At the Federal Open Market Committee (FOMC) meeting, the Fed said it would keep the federal funds rate between 5.25% and 5.50%. This is the second pause since the Fed began raising rates back in March 2022.

The announcement did little to strengthen risk assets such as bitcoin (BTC-USD). The world’s biggest digital asset in terms of market capitalisation has declined 0.5% during the last 24 hours to a current price of $26,978, according to CoinGecko data.

Bitcoin showed its tendency to march in lockstep with equities. The tech-heavy Nasdaq Composite declined nearly 1.5% during trading on Wednesday. Global stocks slipped and US Treasury yields rose after Fed Chair Jerome Powell dashed hopes of a rate hike reversal by suggesting there could be a much tighter monetary policy through 2024 than previously anticipated. The rate-setting Federal Open Market Committee said “inflation remains elevated” and Powell stressed that the Fed’s job is to lower it.

Nevertheless, Powell emphasised the primary objective of the Fed’s monetary policy was a soft landing. The Fed will strive to execute its tightening campaign without triggering a widespread economic downturn.

That is what we have been trying to achieve for all this time, he said during Wednesday’s Fed policy press conference.

The monetary policy update came after an announcement from Laser Digital Asset Management, a subsidiary of Japan’s Nomura bank, that it is introducing a Bitcoin Adoption Fund.

The aim of the fund is to provide institutional investors with a streamlined and efficient entry point into the fast evolving digital assets space.

This fund positions itself as a cost-effective and secure investment option for gaining exposure to the digital asset.