Bitcoin jumped 4.5% to $105,000 on January 29 following the Federal Reserve's decision to maintain current interest rates. The surge came after five consecutive days of losses, putting Bitcoin within $4,000 of its recent all-time high achieved during President Trump's first day in office.
The price rally emerged as markets recovered from turbulence caused by Chinese AI company DeepSeek. Bitcoin's price movements have increasingly aligned with stock market patterns in recent weeks, particularly as inflation concerns pushed both traditional and crypto markets into defensive positions.
FRNT Financial Inc. CEO Stephane Ouellette attributed the bounce to market recovery rather than direct Fed influence. "We view the move as more related to recovering from the nonsensical sell-off earlier in the week and putting the Fed announcement behind us," he noted.
Federal Reserve Chair Jerome Powell made unexpected supportive comments about cryptocurrency during the post-FOMC press conference. "Banks are perfectly able to serve crypto customers as long as they can understand and service the risks," Powell stated, marking a notable shift from previous regulatory stances.
This statement contrasts sharply with recent years' "debanking" trends, where financial institutions frequently terminated services to crypto-related businesses. Powell directly addressed this issue, stating, "We certainly don't want to take actions that would cause banks to terminate customers who are perfectly legal just because of excess risk aversion."
The Senate Banking Committee plans to investigate these debanking practices on February 5. The hearing will feature testimony from Anchorage Digital CEO Nathan McCauley, Black Rifle Coffee founder Evan Hafer, and DWT Law partner Stephen Gannon, examining why banks have been cutting ties with crypto businesses.
Major banks maintain they don't discriminate based on politics. However, JPMorgan CEO Jamie Dimon noted that banks often must close accounts without explaining why, suggesting a need for "clearer rules about what we have to do and what we don't have to do."
President Trump recently criticized Bank of America and JPMorgan at the World Economic Forum, alleging discrimination against conservative businesses and calling for more inclusive banking practices.