Bitcoin: The cryptocurrency world has always been volatile, but this time, investors have found solace. The Federal Reserve has cut interest rates, and the U.S. Securities and Exchange Commission (SEC) has approved new listing rules for crypto-based exchange-traded funds (ETFs). These two decisions have combined to boost Bitcoin and other cryptocurrencies. While the market remains cautious, investor enthusiasm is evident.
Federal Reserve’s Big Decision and Impact on Crypto
The Federal Reserve, as expected, cut its benchmark interest rate by 25 basis points. The rate now ranges between 4.0% and 4.25%. This decision has had a direct impact on cryptocurrencies because lower interest rates mean investors have more capital available to invest in speculative (riskier) markets like crypto. This is why the price of Bitcoin rose to $117,267.
However, Fed Chair Jerome Powell also made it clear that risks to the US economy remain. Concerns were raised, particularly about the weak job market and persistent inflation. Meanwhile, Powell dismissed calls for a large-scale rate cut, indicating that the recovery would be gradual.
New SEC Rules and the Path to Crypto ETFs
Following the Federal Reserve’s decision, the SEC also provided relief to investors. The SEC approved a proposal submitted by three national securities exchanges, allowing cryptocurrency and commodity-linked ETFs to be approved under the General Listing Standards.
Previously, each spot crypto ETF had to undergo a separate case-by-case review process, which was time-consuming. However, under the new rules, this process can now be completed in just 75 days. This means that new ETFs based on cryptos like Solana and XRP could soon be available in the market. This change will not only ease investors’ interests but also strengthen the crypto market’s legitimacy.
Altcoins and Mimecoins Gain Momentum
The Fed and SEC decisions impacted not only Bitcoin but other cryptocurrencies as well. The price of Ethereum, the world’s second-largest crypto, rose 1.7% to $4,590. XRP gained 2% to reach $3.08.
Solana was the biggest gainer, rising 4.1%, while Cardano also gained 3.6%. Mimecoins like Dodgecoin were also not far behind, rising 4.7%. Even the $TRUMP token gained 1.2%. This indicates that investors are now investing not only in large coins but also in smaller and fun coins.
Signal for Investors
This shift in the crypto market is a positive sign. Interest rate cuts and relaxed ETF regulations have given investors confidence that demand for cryptocurrencies may increase in the future. The crypto market saw a historic surge, especially in 2021, when interest rates were near zero. Investors are currently hopeful that the market may once again surge.
However, it is also true that issues such as uncertainty in the US economy and inflation remain significant risks. Therefore, it is crucial for crypto investors to remain cautious.
The current situation for Bitcoin and other cryptocurrencies has brought a new ray of hope for investors. The Federal Reserve’s rate cuts and the SEC’s new regulations are strengthening this market. However, the crypto market has always been volatile and may see significant fluctuations in the coming days.
Disclaimer: This article is for informational purposes only. Do not construe the information provided as investment advice. Cryptocurrencies and the stock market are risky. Consult your financial advisor before investing.
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