Bitcoin Surges Past $80,000 as Fed Rate Hike Expectations Cool

Bitcoin surged past the $80,000 mark on Thursday, leading a broad rally in digital assets and related equities as traders scaled back expectations for a near-term Federal Reserve interest rate hike.

At the time of reporting, Bitcoin was up over 5% to approximately $80,800, while Ethereum climbed more than 4.8% to around $2,494, according to market data.

Fed Hike Odds Tumble

The primary catalyst for the rally in risk assets was a shift in U.S. monetary policy expectations. The move was triggered by new data showing a larger-than-expected increase in initial jobless claims, signaling some cooling in the labor market. A softer job market reduces the urgency for the Federal Reserve to tighten monetary policy further.

Adding to the dovish sentiment, Federal Reserve Governor Christopher Waller stated that he would support holding interest rates steady at the September meeting if upcoming August inflation data shows a moderation in price pressures. In response, traders sharply adjusted their rate hike bets. According to the CME FedWatch Tool, the probability of a 25-basis-point rate hike at the Sept. 15-16 FOMC meeting fell from 63.2% on Wednesday to 50.4%.

Crypto Stocks Rally on Bitcoin's Momentum

The surge in cryptocurrency prices provided a strong tailwind for publicly traded companies in the digital asset sector. The rally builds on a strong August for Bitcoin, which saw approximately $3.5 billion in net inflows to U.S. spot Bitcoin ETFs, the largest monthly inflow in over a year.

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Key stock movements on Thursday included:

• MicroStrategy (MSTR), which holds significant amounts of Bitcoin on its balance sheet, rose 12%.
• Coinbase (COIN), a leading U.S. crypto exchange, gained 8.9%.
• Stablecoin issuer Circle Internet Group (CRCL) jumped 13%, while Galaxy Digital (GLXY) climbed 11%.
• Crypto miners also saw broad gains, with Bit Digital (BTBT) up 11% and Marathon Digital (MARA) up 10%.

Robinhood Outperforms on Blockchain Revenue

Shares of Robinhood Markets (HOOD) were a standout performer, surging as much as 15% during Thursday's session. Beyond the broader market optimism, the company benefited from positive data regarding its own blockchain operations.

According to data from DeFiLlama, the Robinhood Chain generated approximately $4.32 million in revenue over the past 24 hours, ranking it first among major blockchain networks during that period. This figure surpassed the revenue generated by Solana (~$3.98 million) and Ethereum (~$1.75 million), reinforcing market confidence in Robinhood's ability to monetize its expanding digital asset business.