Bitcoin rose to around $81,000 on October 28, powered mainly by gains in technology and semiconductor shares that helped improve overall market risk appetite.

As of 1:27 p.m. Beijing time on October 28, Bitcoin was up 1.2% at $80,948.5, a clear recovery from the low of $79,496.8 touched earlier in the week.

Even so, with the Federal Reserve set to announce its rate decision, investors remain cautious, and the cryptocurrency market's advance has stayed limited.

Tech rally drives crypto rebound

The latest crypto rebound was largely driven by strength in technology stocks. After South Korean memory chip maker SK Hynix reported strong earnings, market confidence in artificial intelligence-related investment received a further boost, lifting tech and AI-linked shares that had previously come under pressure.

Because cryptocurrency and technology stock prices often move closely together, the tech rebound also drew some capital back into the crypto market.

Other major cryptocurrencies rose in tandem. Ethereum gained 2.2% to $2,355.47, XRP climbed 2.4% to $1.3275, Solana advanced 2.5%, and BNB added 1.4%.

Among meme coins, Dogecoin rose 3.4%, while the Trump-themed token TRUMP gained 1.7%.

Despite the recent bounce, Bitcoin may still post a decline of about 3.2% for October, which would mark a second consecutive yearly drop in the month.

Historically, the crypto market has tended to perform strongly in October, a seasonal pattern investors call "Uptober," but that pattern has not reappeared this year.

Fed rate decision looms, market wary of hawkish signals

Investors are now waiting for the Federal Reserve to release its rate decision on Wednesday local time. The market widely expects the Fed to keep its policy rate unchanged at 4.0%, but persistent U.S. inflation and energy prices pushed higher by the Middle East war have left investors worried that the Fed could send a hawkish policy signal.

For higher-risk assets such as Bitcoin, keeping interest rates elevated for a prolonged period usually means higher funding costs, while also making yield-bearing assets such as bonds more attractive, thereby weakening investors' willingness to allocate funds to cryptocurrencies.

In addition, the European Central Bank and the Bank of Japan will also announce their rate decisions later this week. The market expects both central banks to hold rates steady as well, but their comments on future monetary policy could still influence the direction of global risk assets.