- The cryptocurrency market experienced an upswing following a substantial Fed rate cut.
- Trump made history as the first former president to make a transaction with BTC.
The cryptocurrency market had a positive response to the U.S. Fed’s first rate cut in four years.
On September 18th, the Federal Reserve lowered interest rates by 0.50% (50 basis points), a move that surprised many economists who were anticipating a 25 basis point cut.
In the wake of the Fed’s announcement, Bitcoin [BTC] saw a rise of 2.3% during the intraday trading session on Wednesday, climbing to $62.5K during early hours on September 19th in Asia.
Source: Coin360
At the time of writing, the asset was priced at $62.1K, with significant gains noted throughout the market. Ethereum [ETH] recorded a 5% increase in the past 24 hours.
In contrast, Solana [SOL] led the daily gains among major cryptocurrencies, achieving approximately 6.4% growth in the same timeframe.
Nonetheless, market analysts maintained a cautious stance, indicating that the Fed’s significant cut could hint at an economic slowdown, which might unsettle risk assets in the short run.
BitMEX founder Arthur Hayes labeled this aggressive rate cut as a ‘nuclear catastrophe for financial markets’, suggesting it could result in subdued prices after two days.
He also cautioned that the upcoming decision from the Bank of Japan (BoJ) on Friday could play a crucial role in determining BTC’s price direction. Hayes pointed out,
“A weak JPY will lead to a stronger BTC and vice versa.”
On the other hand, BTC investor Antony Pompliano argued that recession fears are primarily a concern for short-term speculators, asserting that the Fed’s rate cuts are bullish for long-term BTC investors.
Trump becomes the first former president to conduct a BTC transaction
On September 18th, former US president Donald Trump visited the iconic New York PubKey bar and made a payment using BTC.
He bought food and drinks for his supporters at the bar, completing the payment via BTC. Thomas Pacchia, the owner of PubKey, described the event as “historic.”
“The first transaction by a president on the Bitcoin network. History!”
Unlike his previous tenure in the White House, Trump has shifted his stance to support BTC and has even indicated plans to designate it as a strategic reserve asset if he regains the presidency.
Consequently, BTC’s price movements have increasingly mirrored Trump’s chances of winning the 2024 presidential election.
Source: Polymarket
As of now, the odds of a Trump victory are at 47%, while Harris leads with a 5-point advantage on the prediction platform Polymarket.
Wisdom Tree launches RWA platform on Ethereum
Finally, Wisdom Tree, an asset management firm overseeing $110 billion in assets, has introduced an RWA (real-world asset) tokenization platform that will operate on the Ethereum blockchain.
This initiative, named Wisdom Tree Connect, aims to facilitate integration between Traditional Finance (TradFi) and Decentralized Finance (DeFi), according to the firm. Will Peck, Head of Digital Assets at WisdomTree, stated,
“With growing interest in tokenized real-world assets, WisdomTree Connect … will grant digital funds access to on-chain entities without exiting the ecosystem.”
Wisdom Tree joins other asset managers like BlackRock and Franklin Templeton, which have also launched similar products designed to provide yield-generating options for crypto firms seeking to invest in US treasury bonds as reserves.
