The Latest Crypto News: Federal Reserve Rate Reduction, Bitcoin Surge, Trump’s BTC Transaction, and More
The cryptocurrency market responded positively to the first rate cut by the Federal Reserve in four years.
Unexpectedly, on September 18, the Fed in the United States reduced interest rates by 0.50% (50 basis points), a move that surprised most economists who were anticipating a 25 bps decrease.
Following this change in direction by the Fed, Bitcoin [BTC] saw gains of 2.3% during the intraday trading session on Wednesday. By September 19, in early Asian trading hours, BTC surged to $62.5K.
At the time of this writing, the asset was valued at $62.1K, showing significant gains across the sector. Ethereum [ETH] experienced a 5% increase in the past 24 hours.
Meanwhile, Solana [SOL] showed the highest daily gains among major assets, recording nearly 6.4% profits over the same period.
Despite this positive movement, market experts remained cautious, indicating that the Fed’s substantial rate cut might suggest a slowing economy, causing concerns for risk assets in the short term.
BitMEX’s founder Arthur Hayes labeled the aggressive cut as a ‘nuclear disaster for financial markets’ that could result in muted prices after two days.
Hayes further cautioned that the Bank of Japan’s decision on Friday could be another determining factor for BTC’s future price direction. He remarked,
“A weakened JPY would lead to a stronger BTC, and vice versa.”
Nevertheless, Antony Pompiliano, a BTC investor, argued that worries about a recession only affected short-term speculators, and for long-term investors, the Fed’s rate cuts were bullish for BTC.
Trump Makes History with First Bitcoin Transaction by a US President
On September 18, Donald Trump, the former US president, visited the renowned New York PubKey bar and made a purchase using BTC.
He paid for food and drinks for his supporters at the bar using BTC. PubKey owner Thomas Pacchia described this action as a significant moment in history.
“The first transaction by a president on the Bitcoin protocol. History!”
In contrast to his previous term in the White House, Trump has shown support for BTC and even announced intentions to establish it as a strategic reserve asset if re-elected president.
Consequently, BTC’s price movement has become more closely linked to Trump’s chances of winning the 2024 US elections.
As of the latest data, the probability of a Trump victory stood at 47%, while Harris maintained a 5-point lead on the prediction platform Polymarket.
Wisdom Tree Introduces RWA Platform on Ethereum
Wisdom Tree, an asset manager with $110 billion in assets under management, has introduced an RWA (real-world asset) tokenization platform powered by Ethereum.
The product, named Wisdom Tree Connect, will enable the integration of traditional finance and decentralized finance operations, according to the company.
“With the rising interest in tokenized real-world assets, WisdomTree Connect… will grant access to digital funds to on-chain businesses without leaving the ecosystem.”
Wisdom Tree will now join other asset managers like BlackRock and Franklin Templeton, offering similar products aiming to provide yield-generating instruments for crypto firms seeking exposure to US treasury bonds for reserves.