Bitcoin experienced a notable recovery, surging past $80,000 following comments from a Federal Reserve official hinting at potential market stabilization measures. This largely positive movement came after Bitcoin surprisingly earlier in the week dropped to a year-to-date low. The positive sentiment spread to the broader crypto market, as most of the top 10 cryptocurrencies by market capitalization made positive moves.

Bitcoin also had a big Friday, rallying 5% to trade just below $84,000 at press time. This increase comes after a strong indication from Susan Collins, the president of the Boston Federal Reserve (Fed). She proposed that the agency be empowered to use “different instruments” to stabilize markets when needed. After beginning the week at a new year-to-date low of $74,508, Bitcoin (BTC) price has recovered. On Friday, it bounced back with strength to almost $82,500.

In a separate interview with the Financial Times, Collins declared that the agency is poised to strike. They’ll use “multiple tools” to re-anchor the market should any liquidity issues come up. Investors are fleeing the 10-year Treasury Note, which is the benchmark for mortgages and other long-term debt. Consequently, its yield has skyrocketed to almost 4.5%, a stark contrast with the current risk-off mood surrounding the stock market.

"The core interest rate tool we use for monetary policy is, certainly not the only tool in the toolkit and probably not the best way to address challenges of liquidity or market functioning," - Susan Collins, head of the Boston Federal Reserve (Fed).

Following Collins’ remarks, the crypto market immediately responded with some fervor. Crypto investors today are hoping that the same happens if Treasuries continue to tank. Recall that in early 2020, the Treasury markets effectively froze as the COVID-19 pandemic began. To jumpstart the economy, the Federal Reserve intervened and purchased government bonds to artificially depress yields.

Collins’ comments combined with Thursday’s better than expected PPI data helped Bitcoin regain the $83,000 mark. That positive sentiment created an upward ripple effect throughout the market, pulling most of the other large cryptocurrencies up alongside it.

Ethereum, XRP, Solana and Dogecoin were up 3%, 2.5%, 8% and 4% respectively. As of Friday, SOL price is up a little bit today, with Solana currently trading at $117.31. That’s a 3.4% bump from the IPO opening-day price of $112.80.

Particularly after a boom marked by significant uncertainty, the market’s subsequent recovery brought about a huge shakeout. Total liquidations across crypto markets reached $2.18 billion.

Here’s what’s important to remember: around that time, Bitcoin was trading at about $5,000 per unit. The smart contracts token plummeted after a rapid rebound to $120. This spike occurred just after US President Donald Trump announced a 90-day tariff hold on Wednesday.

The shift more than cancelled out its Thursday loss of over 4%, driven by risk-off sentiments as fears over a global trade war continued. This underscores the susceptibility of the crypto market to macroeconomic and geopolitical developments.