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Bitcoin returned to $80,000 on Friday, reaching a two week high as the broader cryptocurrency market joined the advance. The rally arrived despite a Federal Reserve interest rate increase earlier in the week and continued uncertainty surrounding federal digital asset legislation.

The Clarity Act failed to advance in the Senate, blocking legislation that would have established a federal framework for the broader digital asset industry. Yet that setback did not prevent traders from driving Bitcoin and other cryptocurrencies higher.

The Securities and Exchange Commission stepped in Thursday after the measure stalled. It issued a conditional exemption allowing certain tokenized stocks to trade on blockchains for the next five years, creating a notable development for that corner of the digital asset market.

Cryptocurrencies showed resilience after the Federal Reserve raised interest rates, even as investors anticipated at least one additional increase this year. The market absorbed the tighter rate outlook without surrendering the momentum that carried Bitcoin back above a major price threshold.

“Crypto has absorbed a fairly aggressive hawkish repricing without much damage,” Sean Farrell, head of digital assets at Fundstrat, said Friday. His assessment captured the market’s ability to withstand a shift toward expectations for tighter monetary policy.

Friday’s Bitcoin move appeared to be driven largely by technical forces, with derivatives traders positioned strongly on the bullish side. Buying connected to US spot exchange traded funds and traders closing bearish positions also contributed to the move.

“US spot ETF inflows and short covering helped push it through the psychologically important $80,000 level,” Bitget Wallet research analyst Lacie Zhang wrote Friday. The breakthrough put Bitcoin at the center of a rally that extended well beyond a single cryptocurrency.

Although Bitcoin led Friday’s surge, several alternative tokens delivered stronger results over the past month. Ether (ETH-USD), binance (BNC-USD), and solana (SOL-USD) gained 35%, 25%, and 41%, respectively, according to Yahoo Finance’s AlphaSpace data.

Those monthly gains showed investors moving beyond Bitcoin and allocating money across a wider group of digital assets. The rotation also included tokenized versions of Nvidia (NVDA), Tesla (TSLA), and the S&P 500 (SPY) on Friday.

The broader buying helped lift total cryptocurrency market capitalization to $2.66 trillion, according to CoinMarketCap. That expansion accompanied Bitcoin’s return to $80,000 and the stronger monthly performance posted by several altcoins.

Strategists have also identified signs that the cyclical crypto winter may have ended. That view received another boost last week when Compass Point’s Ed Engel changed his rating on cryptocurrency platform Coinbase (COIN) to Neutral from Sell.

Engel cited “BTC is recovering from a cyclical bottom” when updating the Coinbase rating. Yahoo Finance disclosed that it has a partnership with Coinbase, which pays the outlet for certain activity generated through a link displayed with its cryptocurrency coverage.

Bitcoin gained roughly 25% in August, though it remained down 8% for the year to date. The contrast shows a powerful recent rebound that has not yet erased the token’s losses across the full year.

The latest rally unfolded against two challenges that could have weighed more heavily on cryptocurrency prices. The Federal Reserve raised rates for the first time in three years, while the Clarity Act failed to clear the Senate.

Instead, Bitcoin broke back through $80,000 as bullish derivatives activity, US spot ETF inflows, and short covering supported prices. At the same time, substantial monthly gains in ether, binance, and solana demonstrated that the rally had spread across the crypto market.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.