Bitcoin surged to a new all-time high on Sunday, reaching $106,509 as investors anticipated a potential interest rate cut by the Federal Reserve.

The cryptocurrency gained over 4%, with its price settling at $105,207.

Ether also rose by 4%, approaching the $4,000 mark, while the broader crypto market, represented by the CoinDesk 20 index, experienced a similar 4% increase.

Bitcoin’s rally followed a strong performance by the Nasdaq Composite, which gained 0.3% on Friday, outpacing other major stock indexes.

Investors are anticipating the Federal Reserve to announce a 25-basis-point rate cut during its two-day policy meeting this week, with the CME Fedwatch tool indicating a 96% likelihood of the move.

A rate cut could benefit Bitcoin, which tends to trade similarly to tech stocks and often thrives in a lower interest rate environment.

Lower interest rates typically signal a weaker dollar and increased money supply, both of which have shown long-term correlations with Bitcoin’s price.

Bitcoin is up nearly 8% for the month, 50% since the U.S. presidential election, and 145% for the year.

The potential for a more favorable regulatory environment and the prospect of a national strategic Bitcoin reserve under the incoming Donald Trump administration continue to act as positive catalysts for Bitcoin and the broader cryptocurrency market.