Bitcoin market analysts are forecasting that the value of the world’s largest cryptocurrency might soar in the wake of the U.S. Federal Reserve’s jumbo-sized interest rate cuts on Wednesday.

An hour after the Federal Reserve’s historic announcement declaring that interest rates would be slashed by a half-percentage point on Wednesday, bitcoin jumped from $59,500 to $61,000. It is currently trading at more than $63,000 at the time of writing, representing an approximately 6% increase from yesterday's price.

Moreover, the fourth quarter of this year is likely to bring accelerated inflows to bitcoin exchange-traded funds (ETFs), according to Alice Liu, Lead Researcher at CoinMarketCap. Ethereum ETFs might also benefit from increased inflows, thanks to market dynamics bringing more capital into crypto and other risky assets, she added.

“Historically, [the fourth quarter] has often been a strong period for bitcoin, with an average price increase of 90.33% over the past 10 years,” Liu said. “Notably, this year, we’re entering [the fourth quarter] from a relatively low price level. With these factors in mind, there’s a significant chance we could see a price surge during the remainder of the year, potentially even pushing bitcoin towards another all-time high.”

Bitcoin also has a favorable environment thanks to a reduction in liquidity. “A half a percent cut is a positive surprise, and represents an easing of liquidity conditions,” added Steven Lubka, Head of Swan Private at Swan Bitcoin. “Bitcoin is highly correlated to the liquidity environment, and this should support higher bitcoin prices into the end of the year and beyond.”

Other analysts like Ruslan Lienkha, chief of markets at YouHodler, added that bitcoin was likely to move closer to its all-time high: "This significant cut is seen as highly favorable for equity markets, providing a risk-on signal for traders in the short-term.”

“However, the long-term outlook remains uncertain, as this move could also be seen as an emergency measure, suggesting that the Fed may have delayed action and misjudged the optimal timing for easing,” Lienkha added. “Over the next three months, it will become clearer whether the Fed can guide the economy toward a soft landing and avoid a recession in this cycle.”