Daily News | Fed Announced 50 Basis Point Interest Rate Cut, BTC Led Overall Crypto Market to Rebound Significantly

2024-09-19, 04:36

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## Crypto Daily Digest: If Bitcoin breaks through $64000, the mainstream CEX's accumulated short clearing strength will reach 540 million
According to Farside Investor data, the US spot <a href="/ru/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> ETF had a net outflow of $52.83 million yesterday, including a net outflow of $8.13 million from GBTC and $43.41 million from ARKB. BlackRock IBIT has no inflow or outflow of funds.

The US <a href="/ru/price/ethereum-eth" target="_blank" class="blog_inner_link">Ethereum</a> spot ETF had a net outflow of $9.71 million yesterday, with a grayscale ETF outflow of $14.7 million and a BlackRock ETF net inflow of $4.95 million.

**Data: If Bitcoin breaks through $64000, the mainstream CEX's accumulated short clearing strength will reach 540 million**

According to Coinglass data, if Bitcoin breaks through $64,000, the mainstream CEX's accumulated short clearing strength will reach 540 million. On the contrary, if Bitcoin falls below $60000, the cumulative liquidation strength of mainstream CEX orders will reach 708 million.

The liquidation chart shows to what extent the target price will be affected when it reaches a certain position. A higher 'liquidation column' indicates that the price will have a stronger reaction due to the wave of liquidity once it arrives.

**BlackRock released white paper detailing Bitcoin's position as a unique asset class**

BlackRock, the world's largest asset management company, recently released a 9-page white paper detailing the unique position of Bitcoin as a major asset class.

The white paper points out that Bitcoin is not only a "unique diversification tool", but also difficult to evaluate using traditional asset analysis methods. BlackRock emphasizes that Bitcoin is "almost unaffected by macroeconomic factors that affect most traditional asset classes," making its performance and price predictions challenging. Although Bitcoin is still considered a 'high-risk' asset, it has performed better than all other major asset classes in 7 out of the past 10 years.

BlackRock believes that the volatility of Bitcoin prices partially reflects its evolving prospects as a global currency alternative. The white paper also mentions that due to Bitcoin's apparent independence from global macro factors, some investors view it as a "safe haven" option in geopolitical tensions.

**The last time the Fed cut interest rates by 50 basis points was in March 2020, and since then, Bitcoin has risen more than tenfold**

According to statistics, the last time the Federal Reserve cut interest rates by 50 basis points was in March 2020, when it cut interest rates by 1 percentage point to 0-0.25% in response to the COVID-19 epidemic. Since March 2022, the Federal Reserve has launched an almost unprecedented aggressive interest rate hike and has maintained the policy rate at a high level of 5.25% -5.5% since July 2023.

After the interest rate cut in 2020, Bitcoin started to rise from the price range of $4,000 to $6,000 after "3.12", and reached the peak of the previous bull market at $69040 in November 2021, with a maximum increase of more than 10 times.

During the same period, the price of gold started to rise in the range of $1,450 to $1,700 in March, surpassing Bitcoin's peak earlier. After reaching a high of $2,075 in August 2020, it fell back and began a new round of upward trend after reaching a bottom of $1,616 in November 2022.

## Market Trends: BTC led the market to a significant rebound, while SUI, FTM, and others performed well
### Mainstream Coins
BTC returned above $62,000 after the Federal Reserve's decision to cut interest rates by 50 basis points today, leading the overall <a href="/ru/price" target="_blank" class="blog_inner_link">crypto market</a> to rebound significantly;

ETH returned to $2,400, but the increase is still relatively small compared to other public chain projects. The weakness of ETH ETF is directly reflected in the price of ETH;

Altcoins rebounded significantly, and public chain projects such as SUI and FTM have surged;

In terms of data indicators, the AHR999 index was 0.68 today, indicating that the current <a href="/ru/price/bitcoin-btc" target="_blank" class="blog_inner_link">BTC price</a> is still suitable for long-term fixed investment; The Fear & Greed Index is 49, indicating a significant improvement in the market after the interest rate meeting.

### Market Hotspots
The public chain sector: SUI, FTM, SEI, etc. have surged, while the previous market leaders ETH and SOL have shown relatively weak performance. SUI rose 15% in 24 hours, approaching the $1.4 mark at one point. The Sui ecosystem meme project Blub has surged, with a current market value of $30 million, and has risen more than a hundred times this month.

Meme sector: NEIROCTO, NEIROETH, POPCAT and others have surged, with NEIROCTO continuing to rise and reaching a historic high. NEIROCTO has risen over 200% in the past few days, approaching the $0.001 mark. NEIROETH has experienced an oversold rebound after a sharp decline in the past few days, rising 40% within 24 hours and currently returning to above $0.1. POPCAT is the leading cat meme project on the <a href="/ru/price/solana-sol" target="_blank" class="blog_inner_link">Solana</a> chain, currently only one step away from historical highs. POPCAT is likely to become the first cat meme coin with a market value exceeding $1 billion.

## Macroeconomics: The Fed cuts interest rates by 50 basis points, leading to a slight decline in the overall stock market
The three major indexes of the US stock market collectively closed down, with the S&P 500 index falling 0.29% to 5,618.26 points; The Dow Jones Industrial Average fell 0.25% to 41,503.10 points; The Nasdaq index fell 0.31% to 17,573.30 points. The benchmark 10-year Treasury yield is 3.70%, while the 2-year Treasury yield, which is most sensitive to the Federal Reserve policy rate, is 3.61%.

At 2:00 am (Beijing time) today, the Federal Reserve ended its two-day monetary policy meeting and announced a 50 basis point reduction in the target range for the federal funds rate to 4.75% to 5%, marking the first time the Fed has cut interest rates since 2020. This policy interest rate adjustment marks the official shift of the Federal Reserve's monetary policy. From March 2022 to July last year, the Federal Reserve raised interest rates 11 times in a row for over a year, with a cumulative increase of 525 basis points. Since July last year, it has held eight consecutive meetings without taking action, keeping the policy rate at a high level since 2001.

Another analysis suggests that a 50 basis point interest rate cut by the Federal Reserve is "rare in recent decades," indicating that the Fed is reassured that the downward trend in inflation is sustainable and is now shifting its focus towards achieving a soft landing.

Despite the Federal Reserve's "massive" 50 basis point interest rate cut, Powell's monetary policy statement at the press conference remained restrained. Powell admitted that the Federal Reserve does not have a predetermined policy path and will continue to make decisions at every meeting. If the economy remains stable and inflation remains stubborn, policy adjustments may be slower.

### Conclusion
The overall sentiment in the current market has recovered, driven by macroeconomic positive news. Bitcoin and some Altcoins have shown strong performance, especially in the Meme and GameFi sectors where tokens have shown significant upward momentum. However, Ethereum and some assets are still showing weakness, and investors need to closely monitor market dynamics and policy changes, operate cautiously, and allocate assets reasonably.

<div class="blog-details-info">
<div>Author:**Icing**, Gate.io Researcher
<div>Translator:Joy Z.
<div class="info-tips">\*This article represents only the views of the researcher and does not constitute any investment suggestions.
<div>\*Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.
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