The price of major cryptocurrencies soared on Wednesday after the Federal Reserve announced that it will accelerate the tapering of its asset purchases, with the program set to expire in March, and that the benchmark interest rate would be raised three times next year.

Following the Fed’s announcement, Bitcoin soared from roughly $47,800 to over $49,350. The cryptocurrency is currently worth $49,080, up 2.2 percent in the last 24 hours. Ethereum was at above $4k at press time.

Tapering Scared Investors Off

The crypto market may have already factored in the Fed’s decision to accelerate tapering. Bitcoin has lost more than a quarter of its value since hitting an all-time high of $68,991 in November. Ether has dropped more than 15% from its all-time high of $4,865.6.

Major cryptocurrencies were likely to surge if the Fed was less aggressive than the market predicted, according to several traders. “We’ve been in a risk-off environment in bitcoin and the crypto asset broadly over the last month,” Louis LaValle, managing director at crypto fund manager 3iQ Digital Assets, said. “If the FOMC (Federal Open Market Committee) meeting doesn’t make blockbuster headlines, that could be a buying opportunity for those on the sidelines.”

Powell stated in November that the Fed will “start to reduce the pace of asset purchases,” prompting many to believe that an interest rate hike would be announced at today’s meeting. President Biden recently re-nominated Federal Reserve Chair Jerome Powell for a second term

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