Bitcoin Breaks $80K Barrier as Relief Rally Overpowers Fed Hike

Bitcoin has broken back above $80,000 after a brief dip to $75,000 earlier in September. The rally comes despite several potential market-moving events this week, including a Federal Reserve rate hike and a failed crypto bill in the Senate.

According to traders, this is a classic relief rally. Markets had already priced in the Fed's quarter-point hike before it happened, so when the announcement landed exactly as expected, it carried little new information to react to. Once the selling pressure dried up, shorts who had positioned for a steeper drop were forced to buy back in.

The softer dollar and cooling Treasury yields gave the move extra room to run. Regulatory news also added support, with the Commodity Futures Trading Commission filing two new proposed rules for crypto markets this week. This shows that federal rulemaking is still moving forward despite the stalled Clarity Act in the Senate.